SCA (Buy, TP: SEK208.00) - New kids on the block
Although we have cut our 2023–2024e EBITDA, our earnings scenario remains much above Bloomberg consensus. Due to its backward-integrated business model, SCA is less affected by cost inflation than the rest of the industry, while its forestland provides interesting new opportunities in renewable energy. In December it also made a first step in investing in its own wind parks, and in 2023–2024 we believe it will deploy several billion SEK in this new lucrative field. We reiterate our BUY and target price of SEK208.Svenska Cellulosa is a holding company. Through its subsidiaries, Co. is a global consumer goods and paper company that develops, produces and markets personal care products, tissue, publication papers and solid-wood products. Co. consists of three business areas - Personal Care, Tissue and Forest Products. Personal Care activities comprise three product segments: incontinence products, baby diapers and feminine hygiene products. Co.'s Tissue product portfolio comprises toilet paper, kitchen rolls, facial tissues, handkerchiefs and napkins. Co.'s Forest Products offers publication papers, kraftliner (packaging papers), pulp, solid-wood products and renewable energy.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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