Dino confirmed at HOLD, TP PLN 276.0 - The retail tax poses a temporary threat to margin expansion
As a successful year for Dino draws to an end and the introduction of the retail tax from January 2021 looms, we update our operating assumptions and confirm our HOLD recommendation. We set our one-year target price at our DCF fair value of PLN 276 (PLN 225) per share implying an upside of 1.9%. Impressed by solid 3Q 20 results we revise upwards our FY 20e EBITDA and EPS forecasts by 7.1% and 9.5%, respectively. However, all signs point to the introduction of the retail tax in 2021: 1) The Polish budget plan for 2021 includes a contribution of PLN 1.5 bn, 2) While the Court of Justice of the European Union (CJEU) has not issued its final verdict, the speaker of the ECJ Julianne Kokott stated on October 15 that the Polish retail tax does not infringe EU law. Thus, we expect Dino to pay a total of PLN 168mn of retail tax in FY 21e and PLN 217 mn in FY 22e.Dino Polska is engaged in the business of retail sale in non-specialized stores with food, beverages and tobacco. In addition, Co. conducts processing of meats and the resulting products are dedicated, in the form of culinary meat, to external recipients within Co.'s retail chain. As of December 31, 2016, Co. operated a network of 628 Dino stores.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.