Original-Research

Pro Kapital Grupp AS (von BankM - Repräsentanz der FinTec...

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Original-Research: Pro Kapital Grupp AS - von BankM - Repräsentanz der FinTech Group Bank AG

Einstufung von BankM - Repräsentanz der FinTech Group Bank AG zu Pro Kapital Grupp AS

Unternehmen: Pro Kapital Grupp AS
ISIN: EE3100006040

Anlass der Studie: Bericht H1/2018, Basisstudie
Empfehlung: Kaufen
seit: 16.11.2018
Kursziel: EUR 1,97
Kursziel auf Sicht von: 12 Monate
Letzte Ratingänderung: Keine
Analyst: Dr. Roger Becker, CEFA und Enid Omerovic

Baltic Real Estate as an Opportunity

Pro Kapital Grupp AS (PKG; ISIN EE3100006040, Open Market, 17E GF) is a developer of large-scale retail and residential real estate in the Baltic countries of Estonia, Latvia and Lithuania. The group can look back on a long-term track record in planning, building and selling large real estate projects in different asset classes and enjoys an extensive network among the Baltics with dedicated local management teams. As the company's performance is dependent on the completion and sale of development projects, sales and earnings figures as well as cash flows are inherently volatile.

Despite the high interest expenses, PKG's financial structure indicates no excessive indebtedness. As at the end of Q2 2018, all liabilities in the amount of EUR88.6 mln were collateralized with properties and pledged shares in the amount of EUR181 mln (loan-to-value (LTV) ~ 49%). This in turn has two important implications: Firstly, PKG's current debt level is far away from its debt capacity enabling the company to raise more funds to realize further development projects. Secondly, as the risks for banks providing PKG with loans are quite low (LTV below 50%), terms for additional secured bank loans should still be favorable.

In the first half of 2018, PKG significantly improved net income from a loss of EUR2.6 mln in H1/2017 to a profit of EUR2.8 mln due to a notable rise in revenues from sale of real estate (+258%). Accordingly, gross profit was at EUR5.0 mln, +185% higher compared to previous period. Based on information available in PKG's financial statements we anticipate continuing completion activity of residential development projects leading to a significant expansion of revenues from sale of real estate in the coming years.
Currently PKG's largest single-project is the T1 shopping and entertainment center in Tallinn with a total investment value of EUR78.1 mln. Up to now construction of T1 increased PKG's debt burden considerably. In November 2018 T1 started operations and should significantly contribute to top and bottom line. Furthermore, PKG's risk-return profile is expected to improve as risky revenues related to development projects are complemented by stable and recurring revenue streams from T1 letting activity. This should not only yield steady operating profits in the coming years but also enable the company to pay a dividend on a regular basis.

Our fundamental DCF analysis returns a fair value of EUR1.97 per share. In light of the current share price we rate the stock as 'Buy'.

Die vollständige Analyse können Sie hier downloaden:
http://www.more-ir.de/d/17209.pdf
Die Analyse oder weiterführende Informationen zu dieser können Sie hier downloaden http://www.bankm.de/webdyn/141_cs_Research%20Reports%20Disclaimer.html.

Kontakt für Rückfragen
BankM - Repräsentanz der biw Bank für Investments und Wertpapiere AG Mainzer Landstraße 61, 60329 Frankfurt
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übermittelt durch die EQS Group AG.

Für den Inhalt der Mitteilung bzw. Research ist alleine der Herausgeber bzw. Ersteller der Studie verantwortlich. Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss bestimmter Börsengeschäfte.

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Rating: Kaufen
Analyst: BankM
Kursziel: 1,97 Euro