Märkte & Kurse

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Original-Research: INDUS Holding AG - from NuWays AG

26.09.2024 / 09:01 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
Group AG.
The issuer is solely responsible for the content of this research. The
result of this research does not constitute investment advice or an
invitation to conclude certain stock exchange transactions.

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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:                       26.09.2024
     Target price:               EUR 34.00
     Last rating change:
     Analyst:                    Christian Sandherr

New value accretive deals should fuel long-term growth

Topic: INDUS is working at full speed on its well filled M&A pipeline and
closed already five deals during this year. We take the opportunity to give
more granularity on the case and particularly on INDUS's acquisition side
and the recent operating development. We continue to like the stock and keep
INDUS on our Alpha list.

More value accretive deals in the pipeline: At the end of August, INDUS
announced the acquisition of DECKMA, a system supplier of technical marine
equipment. The company generates c. EUR 19m in revenue and should deliver low
double-digit EBIT margins (eNuW). With a transaction multiple of c. 6x EV/
EBIT and considerable growth opportunities ahead, the acquisition should be
value accretive in our view. Further, INDUS has spent only EUR 31.5m (eNuW) on
M&A this year, which leaves room for further acquisitions. Mind you, the
company intends to spend up to EUR 70m on portfolio additions this year alone.
Due to the decline in valuation multiples of German SMEs in recent years,
management is confident to meet their targets. In fact, several
opportunities should be in advanced stages.

More deals should come in the long run: About one third of SME owners in
Germany is 60 years or older and as the boomer generation is successively
leaving their businesses and searching for successors, more opportunities
should arise. Importantly, thanks to INDUS' positive brand perception, the
company is seen to be a preferred partner for successions, as soft factors
such as safeguarding jobs and maintaining the reputation are often equally
important as the purchase price.

Attractive valuation: Even though the upcoming quarters will still be
influenced by a challenging macroeconomic environment, the capital market is
in our opinion overreacting to the recent guidance cut (company news: July
31st) and the temporary weakness, neglecting the long-term operative
performance and currently depressed valuation of the stock.

Hence, the stock is trading at only 7x forward P/E (eNuW), offers an
expected dividend yield of 5.4% (eNuW FY24e: EUR 1.2 per share), and delivers
a strong FCFY24e of c. 10% (eNuW). We reiterate BUY with an unchanged PT of
EUR 34, based on FCFY24e

You can download the research here: http://www.more-ir.de/d/30893.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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1995907 26.09.2024 CET/CEST

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