Märkte & Kurse

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Original-Research: INDUS Holding AG - from NuWays AG

02.09.2024 / 09:02 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
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The issuer is solely responsible for the content of this research. The
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Classification of NuWays AG to INDUS Holding AG

     Company Name:                INDUS Holding AG
     ISIN:                        DE0006200108

     Reason for the research:     Update
     Recommendation:              Buy
     from:                        02.09.2024
     Target price:                EUR 34.00
     Target price on sight of:    12 months
     Last rating change:
     Analyst:                     Christian Sandherr

New acquisition announced and further M&A targets in reach

Topic: INDUS announced last Friday the acquisition of DECKMA, a system
supplier of technical marine equipment, which now belongs to the Engineering
segment. Further acquisitions are planned during the remainder of the year.

INDUS acquired 75% of the shares in DECKMA and holds an option to acquire
the remaining 25% in 2026. INDUS will keep the existing management team
after the acquisition in place. DECKMA is a specialist in lighting and fire
alarm systems, corrosion protection technology, and automation solutions for
ships. Customers of DECKMA are in the shipbuilding and offshore industry,
such as manufacturers of cruise ships, merchant ships and mega yachts.

The company generates c. EUR 19m in revenue and is growing profitable.
Further, we estimate DECKMA to deliver a low double-digit EBIT margin and
the transaction multiple to be around 6x EBIT. This leads to an estimated
purchase price of EUR 13m (eNuW). With that, INDUS has spent EUR 31.5m (eNuW) on
M&A this year, which leaves still room for further acquisitions to meet the
EUR 70m annual budget. The company is confident of using the full budget this
year due to several attractive opportunities and expects another acquisition
to be made in the near future.

We interpret the acquisition as positive news as historical EBIT multiples
in the German Small Cap M&A market have come down considerably in the recent
years. Further, the global number of container ships increased steadily over
the last decade, driven by globalization of the economy. In addition, growth
potential should also come from the increasing number of offshore wind
farms. For instance, EnBW started this year to build the largest German
offshore wind farm named "He Dreiht" around 110km west of Helgoland. Ships
are not only needed to build the 64 wind turbines for "He Dreiht" and other
wind farms, but also for maintenance after the wind turbines started
operating, which could lead to recurring revenues.

INDUS remains a BUY in our view as the company is (1) trading at only 7x
forward P/E (eNuW), (2) offers
an expected dividend yield of 5.3% (eNuW FY24e: EUR 1.2 per share), and (3)
delivers a strong
FCFY24e of c. 10%. We continue to like the stock and keep INDUS in our Alpha
list.

Reiterate BUY with an unchanged PT of EUR 34, based on FCFY24e.

You can download the research here: http://www.more-ir.de/d/30681.pdf
For additional information visit our website: www.nuways-ag.com/research

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss
bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben
analysierten Unternehmen befinden sich in der vollständigen Analyse.
++++++++++

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1979087 02.09.2024 CET/CEST

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