Aquila Part Prod Com: tap into Romania’s thriving consumer market (BUY – initiation of coverage)
We initiate coverage of Aquila Part Prod Com S.A. (Aquila), a leading Romanian FMCG distributor, with a price target (PT) of RON 1.42/share (c.33% upside) and a BUY rating. Aquila distributes a wide range of food and non-food consumer goods to c.72k points of sale, covering >90% of Romania. It also has operations in Moldova. The stock offers investors exposure to the broader Romanian retail market, where we see a strong macro tailwind. We also see less risk of margin compression, thanks to its combination of sales channel exposure and potential upside from a growing share of own-brand products. We forecast 2023-26E revenue and net profit CAGRs of 11.7% and 22.4%, respectively, including the recently-announced acquisition of Parmafood. On our forecasts, the stock trades on an average 2024-25E P/E of 10.3x and EV/EBITDA of 6.3x, representing a c.28% discount to our peer group median, while generating ROACEs in the low-20%s.
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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