Inter Cars: solid play, attractively priced (BUY - transfer of coverage)
In this report, we transfer coverage of Inter Cars (CAR), maintaining our BUY rating. We increase our 12M price target (PT) by 6% to PLN 670, which offers an attractive 38% potential upside. The increase stems from our upward forecasts revisions, on both the top line and EBITDA profitability. While we see some downside risks for the gross margin this year, and some pressure on SG&A from rising salaries and, temporarily, also due to logistics capacities expansion next year, we forecast a sound 11% EBITDA CAGR over 2022-25E. We believe there is room for positive surprises vs. the current Bloomberg consensus for the 2023-24E EBITDA (we are 5-8% above). We view the current c.30% discount vs. its peers on 2023-24E EV/EBITDAs as an attractive entry point.Inter Cars is an automotive spare parts distributor for passenger cars, commercial vehicles and trucks in Middle-Eastern Europe. The product range of Co. reaches over one million different automotive spare parts for passenger cars and trucks. No matter if the car is European or Asian one, Co.'s customers can find full range of products for their cars as well as all the necessary tools and garage equipment. Besides spare parts distribution, which is the core business of Co., Co. is also an exclusive distributor of legendary motorcycle brand “TRIUMPH” in Poland (via motorcycle distribution network, called Inter Motors) and distributor of spare parts and accessories for other motorcycle brands.
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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