WOOD Flash – Mail.ru: 3Q20 – strong, boosted by games and new initiatives
Mail.ru has delivered strong 3Q20 results, especially in the games and new initiatives segments, and raised its FY20E outlook for the group revenue, in line with its pre-pandemic guidance; although, with faster growth coming from new businesses, its outlook for EBITDA is now expectedly more conservative: a “mid-20s margin” compared to 33.5% in 2019 (and our estimate of 27%). We continue to view Mail.ru as an undervalued, high-growth business, with its current price of USD 29/GDR reflecting only the value of its social media and games segments, while its other businesses represent free option value, on our estimates. However, we believe that the company needs to, eventually, start to integrate all of its various segments on a unified platform, providing a single customer experience and extracting the maximum synergies, while its current, more portfolio approach to various services may extend the cash-burn phase and drag its overall profitability down.Mail.Ru Group is an Internet company based in the Russian Federation. Co. operates the email service [email protected] and two IM networks in Russia - Mail.Ru Agent and ICQ. Co. operates two Russian-language online social networking sites: Moi [email protected] and Odnoklassniki.ru, and owns a strategic minority equity stake in the social network Vkontakte. Co. is also engaged in developing projects in E-commerce and operating more than 40 thematic vertical sites, targeting various user categories. Co. is also Russia's predominant online games company. Co. maintains a portfolio of online games which includes 34 MMO games and over 30 games for social networking sites.
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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