Wirtualna Polska: Polish online outperformer
We keep WPL at a BUY and lift our FV to PLN 74.6 (from PLN 67.9) as we upgraded our 19E/20E/21E EBITDA forecasts (by 2%/4%/6%) thanks to higher than expected P&L growth. WPL maintains very good P&L momentum with top-line and EBITDA LfL LTM YoY dynamics at +18% and +10%, respectively (or +32%/+16% reported). This is not only a result of WPL’s exposure to fast-growing ecommerce and online ad or numerous acquisitions but also WPL’s ability to monetize effectively its 21.3m RU base and carry out an internal restructuring (improving ad viewability ratio), which would allow it to outperform the competition and the market. The business environment should remain supportive for WPL in 2020. WPL expects the online ad market to grow at a high single digit pace in 2020 (in line with our forecasts) while it expects ecommerce to continue to grow fast thanks to ongoing digitalization of the economy. The biggest risk we see to WPL’s investment case is a faster global/domestic slowdown that may visibly trim online ad budgets and private consumption in ecommerce (not our base scenario). On our numbers, WPL trades at a 19E/20E EV/EBITDA of 11.3x/9.5x, still attractive for the P&L dynamics WPL offers.Wirtualna Polska Holding SA is a Poland-based holding company. The Company owns entities that are engaged in the Internet publishing and broadcasting content, including operating business, technology, sports and entertainment portals, as well as electronic mail (e-mail) and electronic commerce (e-commerce). It also offers a range of advertising products, including display ads. The Company operates through such Internet portals as Wirtualna Polska, o2.pl, Money.pl, WP SportoweFakty, Dobreprogramy.pl, WP Parenting, Domodi and Homebook, among others. The Company operates domestically.
Haitong is the first international Chinese investment bank and our goal is to be the primary channel for capital flows into and out of China. During 2015 the Senior Management Team in London was expanded significantly to focus on this objective and to provide a full-service cross-asset markets business coupled with sector-focused investment banking. We work closely with our world-wide network of offices to bring a true depth of understanding to all client situations.
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