DSM-Firmenich Steady as she goes

The recent strategic update & CMD reconfirmed the direction to focus on Nutrition, Health and beauty, with Animal Nutrition & Health earmarked for separation. The mid term financial targets for the new scope (ie ex ANH) including a 5-7% organic sales growth and an 22-23% adjusted EBITDA margin target imply a solid earnings momentum for the coming years, and even our more conservative margin assumptions imply a 7% EBITDA CAGR until 2028. We still appreciate dsm-firmenich for its broad portfolio and market leading positions in the core consumer-oriented businesses. The upcoming separation of the Animal Nutrition & Health business can be a catalyst to unlock value and we maintain our Accumulate rating and € 120 target price.