Answear initiated at BUY, PLN 25.0 - A CEE online fashion specialist with a clear vision
We initiate coverage of Answear, an e-commerce multibrand fashion retailer active in eleven countries, with a 12-m TP of PLN 25.0 and BUY recommendation.The company operates a streamlined business model targeting relatively well off and fashion-conscious CEE customers focussing its efforts on premium brands and on its margin-accretive own brand.
While FY 22e profitability should not impress we project a rebound of the EBITDA margin from 4.9% in FY22e to 6.0% in FY 24e, a beat of the incentive plan EBITDA FY 22e target of PLN 42 mn (RBIe PLN 43.9 mn) and see room for further improvements ahead.
We expect steep growth to continue, despite an exposure of ca. 17% of the top line to Ukraine, at CAGR 21-24e of 31.0% with regard to net revenues and 26.3% with regard to EPS.
We highlight the relative protection from global supply side issues affecting some e-commerce peers and the 35% discount to peers on P/E 23e.
The Institutional Equity Research team of Raiffeisen Bank International AG covers 85 stocks from Austria, Central & Eastern Europe with sell-side research and thus levers our local broker status with excellent company relationships. For corporates in Austria, CEE and Western Europe, we offer co-sponsored research, which includes research coverage and marketing activities to investors. Additionally, through our Spotlight Research product we also shed light on leading European small and micro-caps, seeking greater visibility with investors.
The Institutional Equity Research team consists of roughly 15 analysts, both in Vienna and the CEE countries. Our analysts provide long-standing sector expertise in tandem with profound local market know how and a sectoral approach across the entire region.
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