Patria Bank: Still Holding our position on the sidelines (stays HOLD)
We maintain our HOLD recommendation on Patria Bank Group and keep our 12-month price target (PT) almost unchanged, at RON 0.101/share, offering potential upside of c.7%. While we continue to appreciate the bank’s profitability and growth potential, as well as its improved capital position, we note that it is fairly priced currently, in our view. Patria Bank trades at 0.8-0.9x P/BVs, on our estimates for 2021-22E, at a c.39% discount to its Romanian peers under our coverage. While this may seem excessive, given the current profitability profile and the scale of the bank’s operations, we deem the discount fair. On our P/E estimates, the bank trades at a premium vs. its peers, but this is a result of the lower ROE levels that the bank generates currently. This is, in our view, likely to improve over our forecast period, as the bank scales up its operations.
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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