Grupa Pracuj - Made to Monetize HR Market Growth
Grupa Pracuj ("Grupa Pracuj" or the "Company") is a leading online HR platform in Poland and Ukraine with a well-established market position. The Company has a large base of loyal customers from Poland and Ukraine. Grupa Pracuj operates in a rapidly-growing recruitment market (with 2019-30E CAGR at 11% in Poland and 18% in Ukraine). Its online employment marketplace, pracuj.pl, is the job platform of first choice for many and a widely recognized brand that, over the years, has gained the trust of job seekers and employers alike; as such, pracuj.pl today stands as the single biggest barrier to entry for market newcomers.
Looking ahead, Grupa Pracuj stands to benefit from a shift in the Polish job market towards a candidate's market. According to our estimates, in 2020-2025 the Company can grow its adjusted EBITDA at an average annual rate of 23%, and with a high cash conversion ratio* (historically CFO/EBITDA at 84-109%) this will translate into high FCFE. Grupa Pracuj has the means to grow its presence further in the CEE region through selective acquisitions while making regular distributions to shareholders.
We initiate coverage of Grupa Pracuj with a buy recommendation and a target price of PLN 88.30 per share that indicates 20% upside potential from the current level.
As of January 2022, a potential invasion by Russia on Ukraine has become a risk factor for Grupa Pracuj. For the purposes of our analyses we assume a de-escalation of the conflict in the medium term.
Set up in 1986, mBank (originally BRE – Export Development Bank) is Poland’s 4th largest universal banking group in terms of total assets and 5th by net loans and deposits at the end of June 2019. mBank has one of the oldest brokerages in Poland – we have been providing brokerage services since 1991 - and the biggest, serving about 300 ths clients.
We provide all brokerage services available in the Polish capital market (i.e. Warsaw Stock Exchange, non-public markets and forex) in a way that meets the expectations of all groups of investors, both individual and institutional. Participating in the dynamic growth of the Polish capital market since its inception, we have acquired competences and experience needed to provide the highest quality of service and we have won the trust and satisfaction of our Clients.
Over the past decade, mBank's Equity Research Team has been consistently ranked among the top research teams in Parkiet's annual institutional investor surveys (Parkiet is Poland's leading daily business newspaper). mBank analysts provide coverage on an extensive list of companies, mainly in Poland but also elsewhere in the CEE region: Austria, Czechia, Portugal, Ukraine and Hungary.
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