NLB Group: Planning is everything (stays BUY)
We remain BUYers of NLB Group (NLB) and have increased our price target (PT) to EUR 78.3/share, from EUR 63/share previously. In our view, NLB offers a unique combination of solid lending growth (mid-to-high-single-digits), a large uplift in EPS over 2022-23E (c.25% p.a.), and strong capacity to pay large dividends. We have increased our earnings forecasts by c.11% in 2022E and c.45% in 2023E, following the finalisation of the Komercijalna Banka acquisition in Serbia and the updated management guidance. The stock trades currently at a P/TBV of 0.55x and a P/E of 6.5x on our 2022E figures. We see these multiples as extremely low in view of its adequate capital position (a TCR of c.17% in our forecast period) and long-term sustainable ROTE of >10%.
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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