Report
Stamatios Draziotis CFA
EUR 534.38 For Business Accounts Only

G.RE.CO.: Greek consumer 2018 outlook – Time to believe?

With the cyclical momentum set to strengthen in the coming months and disposable income having reached an inflection point, we are reasonably sanguine about the outlook for G.RE.CO. stocks. We update our thesis for the consumer-related companies, arguing that improving fundamental data and scope for increasing cash returns substantiate a buy case for our top picks in this space: Jumbo, OTE, OPAP and Fourlis.

On OPAP, we reiterate the view that the present value of gaming duty payments that the company will make post 2021 is lower than implied by the current price, given the contractual terms embedded in the concession agreement.
Underlyings
Aegean Airlines SA

Aegean Airlines is an airline carrier based in Greece. Co. is engaged in aviation transportation, providing services that concern the transportation of passengers and commodities in the sector of public aviation transportation inside and outside Greece, conducting scheduled and unscheduled flights. Co. provides full service, premium quality short and medium haul services. Co. maintains a network of 145 destinations, 111 international in 45 countries and 34 domestic destinations. Co. is a member of global airline network, the Star Alliance network.

Coca-Cola HBC AG

Coca-Cola Hellenic Bottling Co. produces, sells and distributes an extensive portfolio of non-alcoholic ready-to-drink beverages. Co.'s business is engaged in producing, selling and distributing non-alcoholic ready-to-drink beverages under bottlers' agreements with The Coca-Cola Company. In some Territories, Co. also produces, sells, distributes and markets its own brands of juice and Water beverages. In addition, Co. bottles and distributes beer in Bulgaria and Former Yugoslav Republic of Macedonia and Co. distributes a selected number of third party premium spirit brands in certain central and eastern European operations.

Folli Follie S.A.

Folli Follie is an international fashion group, active in more than 28 countries defining new trends in all sectors. Co. designs, produces and markets on a global level its own brands: Folli Follie and British jeweler Links of London (jewelry, watches, accessories and giftware). Co. operates exclusively in the Greek travel retail sector, through Hellenic Duty Free Shops, whereas Folli Follie and Links of London products are also available in-flight on major international airlines. Co.'s brands include Ermenegildo Zegna, Juicy Couture, UGG Australia, Nike, Converse, Calvin Klein Jeans, G-Star Raw, Samsonite, Guess, Franklin Marshall and Technogym.

Greek Organisation of Football Prognostics SA

OPAP is engaged in the operating and management of numerical lottery and sports betting games as well as lottery games. Co. holds concession to operate and manage new sports betting games in Greece as well as a right of first refusal to operate and manage any new lottery games permitted by the Hellenic Republic. Co. operates six numerical lottery games, including Joker, Lotto, Proto, Extra 5, Super 3, and Kino; and three sports betting games consisting of Stihima, Propo, and Propo-goal. Co. is also engaged in designing new lottery games, including Bingo and Super 4. Co. distributes its games through an extensive on-line network of agents.

Hellenic Telecommunications Organization SA

Hellenic Telecommunications Organization is a full-service telecommunications group. Co. provides local, long-distance and international fixed-line telecommunications services in Greece and Romania, and mobile telephony services through its Cosmote subsidiary in Greece, as well as in Albania, Bulgaria, the Former Yugoslav Republic of Macedonia and Romania. Co. also provides internet access services and Internet Protocol (IP) -based telecommunications applications, as well as information technology application development and hosting services using IP technologies. Also, Co. provides several other telecommunications services, including value-added services and public telephone services.

INTRALOT S.A. - Integrated Lottery Systems & Services

Intralot is a supplier of integrated gaming and transaction processing systems. Co.'s operating geographical segments are as follow: European Union, which comprises Greece, Italy, Malta, Cyprus, Poland, Luxembourg, Spain, the U.K., Nederland, Romania, Bulgaria, France, Germany, Czech Republic and Slovakia and Republic of Ireland; Other Europe, which comprises Russia, and Moldova; America, which comprises the U.S., Peru, Brazil, Argentina, Mexico, Jamaica, Chile, Colombia, Guatemala, Dominican Republic, Suriname, Uruguay and St. Lucia; as well as Other Countries, which comprises Australia, New Zealand, China, South Africa, Turkey, South Korea, Lebanon, Egypt, Azerbaijan, Taiwan and Morocco.

Jumbo S.A.

Jumbo is a trading company based in Greece. Co.'s main operation is retail sale of toys, baby items, seasonal items, decoration items, books and stationery. A part of its operations is wholesale of toys and similar items to third parties. Co. and its subsidiaries have four geographical segments: Greece, Cyprus, Bulgaria and Romania. At June 30 2015, Co. operated 72 stores in Greece, Cyprus, Bulgaria and in Romania and the on line store e-jumbo.

Plaisio Computers S.A.

Plaisio Computers SA. Plaisio Computers SA is a Greece-based company that assembles and trades personal computers (PCs), telecommunication and office Equipment. The Company has three main segments of operation, product categories, namely: Office products, PCs and Digital Technology products, as well as Telecommunications products. In addition the Company has two more segments, the provision of service for the PCs and the provision of transportation services, included in the category, Other. Its products are distributed through a network of stores in Greece and Bulgaria and through the distribution of catalogues, as well as electronic stores. The Company has one wholly owned subsidiary, Plaisio Computers JSC, in Bulgaria.

Provider
Eurobank Equities
Eurobank Equities

Eurobank Equities is a Greek-based firm offering research, sales and trading services to institutional, corporate and private clients. The company is wholly owned by Eurobank, one of the 4 systemic banks in Greece.

Research is the backbone of Eurobank Equities' platform, with a team of 4 professionals committed to generating actionable investment ideas by providing timely research products. We are committed to offering value-added services to clients by filtering market noise and providing insights on the multiple sectors that we cover. Our universe includes 26 - large, medium and small cap - companies whose market capitalization amounts to 80-85% of the total market capitalization of the Athens Stock Exchange. Our research team also maintains the capacity to generate ad-hoc research for micro-cap listed companies.

Our team has consistently gained recognition among institutional investors for its quality research, having ranked No. 1 team in Greece at the Extel Surveys of 2013-2016 and 2018. We have also been named Leading Brokerage Firm in Greece over 2014-2016 and in 2018.

Analysts
Stamatios Draziotis CFA

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