Agfa - Again price increases in offset to counter rawmats

Raw material shortage remains an ongoing concern and the competitive environment to secure aluminum and other raw materials has accelerated the cost increase. Recently, aluminum futures traded to a 30-year high on the London Metal Exchange, reporting now at over double the cost of 18 months ago. Agfa was initially hoping that the inflationary pressure would be of a temporary nature, but the issues with global supplies of crucial raw materials have not shown any signs of stabilization. They are likely to stay at these levels in 2022. Agfa will be reviewing the need for further pricing actions on a quarterly basis.
We apply in our model that every 100 USD aluminium increase will have a negative effect on REBIT with a time lag of 9 to 12 months. Although we welcome this double digit price increase that will counter the rawmat increase to some extent we have lowered our FY22 and beyond forecasts for the Offset Solutions business and as a result we lower our DCF and SOTP based Target Price to € 4.4 (was € 4.75). We maintain our Accumulate rating.