Ocado’s share price has taken another battering following downbeat notes from City analysts.

Its shares slipped as much as 4% in trading after UBS issued a ‘sell’ note.

“Although the launch of the second fulfilment centre will deliver some efficiencies, our own analysis of the ‘shop door’ profitability of the first fulfilment centre suggests that the fixed-term costs and low capacity utilisation of the second fulfilment centre will act as a near-term drag,” said analyst Mike Tattersall.

“While the UK online grocery channel continues to gain market share, there is little persuasive evidence that a tipping point of mass-market adoption is approaching, despite supportive technological trends,” he added.

This morning, Panmure Gordon analyst Philip Dorgan warned Ocado was in danger of breaching its borrowing covenants.

He wrote: “We forecast that [Ocado] will breach its net debt to EBITDA covenant in the current year.

“We believe there are three reasons why this will happen. First, we know that the third quarter was affected by the Diamond Jubilee, so the half got off to a slow start.

Second, we expect a similar, but long-lasting impact from the Olympics, with consumers favouring big shops and top-up shops, rather than going online.

“Finally, we expect its competitors to continue to take a larger share of the cake, as they improve their offer relative to Ocado.”

Shares were down around 2.5% in early trading this morning to around 71p.