Renault: 2018 EBIT growth will come from BRICs, “Global Access†and LCVs, no doubt about that
Renault: (BUY, Fair Value EUR112 (+53%))2018 EBIT growth will come from BRICs, “Global Access†and LCVs, no doubt about that
Following a breakfast organised with IR last week in Paris, we come back on Renault’s investment case ahead of its H1-18 earnings publication (July 27th). Group’s increasing positioning in emerging markets should positively contribute to volumes growth even if uncertainties in these markets remain high. Pricing, product & country mix, all combined, should contribute positively (BGe) yet should be offset by raw mat. & FX headwinds. Short term favourable catalysts are limited yet we continue to assume the group is better positioned than Peugeot to play the slowdown of the cycle, the development of BEVs and the margin growth potential. We stick to our Buy rating with FV unchanged at €112/shr.
Renault is an automobile manufacturer. Co.'s activities have been organized into two main business sectors, in more than 120 countries: Automotive and Sales Financing. Co. designs, develops and sells passenger cars and light commercial vehicles. Following the acquisition of Romanian carmaker Dacia and Samsung Motors' operating assets in South Korea, Co. has three automotive brands: Renault, Dacia and Samsung. RCI Banque, Co.'s captive financing arm, finances sales of the Renault, Renault Samsung Motors (RSM) and Dacia brands, and, in Europe, the Nissan and Infiniti brands. In addition to these two activities, Co. has equity investments in the following two companies: Nissan and AVTOVAZ.
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