Alpha Bank: A plan for tomorrow (stays BUY)
We maintain our BUY rating on Alpha Bank and keep our price target (PT) at EUR 1.5/share. Our view on the strategic plan up to 2024E (Project Tomorrow) is positive, and we expect the bank to transition into a growth story, with high capital ratios and ROTEs of 8-10%. On our numbers, we forecast a substantial improvement in the recurring profitability up to 2024E (a three-year CAGR of 30%), driven by growth in the performing loans (c.9% p.a.), strong fees, lower opex and a reduction in the cost of risk, to 60bps. We see the current multiples as appealing (P/TBV and P/E of 0.42x and 5.1x, respectively, on our 2023E), and they do not capture the growth opportunity and ROTE uplift, in our view.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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