Grivalia: Defensive play on Greek recovery (upgraded to BUY)
As a part of a broader Greek sell-off, Grivalia’s shares have lost over 20% since their peak in January, are down 16% ytd and are trading at the lowest levels since the end of 2016. We believe the weakness has created a compelling entry opportunity into a quality, low beta play on the Greek recovery. Grivalia’s low leverage (12% net LTV) offers substantial room for debt-financed expansion, which should drive top-line growth and ROE improvement, in our view. With 95% occupancy and a 9.7Y weighted average unexpired lease term, the rental income is robust. The hospitality portfolio, the expansion of which is ongoing, could improve returns further. Making only cosmetic changes to our forecasts, we set our new 12M price target (PT) at EUR 9.0/share, offering 20% upside, and upgrade Grivalia to BUY (from Hold).Grivalia Properties Real Estate Investment is an investment property group with a major portfolio in Greece and an expanding portfolio in Southeastern Europe. Co.'s business is leasing out investment property under operating leases and is classified as a real estate investment vehicle under Greek Law 2778/1999. Co.'s investment strategy, aims at increasing its revenues and returns and towards creating added value for its shareholders. Co. is seeking to achieve this goal through: analytical follow up and monitoring of the macro-economic indicators; active management of its portfolio of assets; continuous monitoring of the portfolio's risk and the efficient management.
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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