Montea Model Update after ABB raised EUR 126m
We updated our model after the successful ABB on 23/11 added EUR 126m to the war chest for development Capex. The shares were placed at 69.90, a 4.0% discount to previous close and a 2.9% discount to last reported NTA. On 27/10, Montea announced an ambitious development plan of 600k sqm GLA over the next 2 years. Although this plan could have been financed without additional funding, we estimated that the debt ratio would have risen to 43.2% by FY25-end. After this transaction, we estimate now a debt ratio of 38.4% by FY25-end. A lower debt ratio (<40%) often translates into a higher valuation vs. peers which on its turn offers more growth potential (self-fulfilling). It also offers more flexibility if and when interesting deals appear from speculative developers that ran against a refinancing wall. We return to an Accumulate rating and a target price of EUR 90. Impact on our EPS estimates / We do not expect an impact on EPS23 as the NOSH increases for only 1 month. For EPS24, we do expect some dilution as Montea will focus on developments and these can not be added on a 12 month basis. The impact on EPS25 is smaller. With the lower debt ratio, there is potential for some ad hoc opportunities either on standing assets or land bank that increase the future rent income potential.Montea Comm VA, formerly Montea CVA, is a Belgium-based real estate investment trust specialized in logistics and semi-industrial real estate in Belgium, the Netherlands and France. The Company's property portfolio represents approximately a surface of 584,694 Square meters (m2) across 37 sites. Its group companies include, among others, Montea Management NV, Montea Comm. VA, Acer Park NV, Montea Nederland NV, Montea Almere NV, Montea Rotterdam NV, SCI Actipole Cambrai, SCI Sagittaire, SCI Saxo, SCI Sevigne, SCI Socrate and SCI 3R. In addition, the Company also partners with Decathlon.
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