reports
- Research Team
WOOD Flash – Coverage UNDER REVIEW
We are putting our coverage of the following stocks UNDER REVIEW, with immediate effect. We caution against using the forecasts, ratings and price target guidance issued previously on these stocks: Addiko Bank Alro Arion banki Bogdanka Cognor Holding DataWalk Gradus Grenevia Islandsbanki Kety TeraPlast
- Rahul Shah
Arion Bank: Q2 23 profit boosted by wider margins, tight cost control,...
Arion Bank reported Q2 23 net profit of ISK7,091mn, 12% above consensus and 20% above our forecast. The main driver was a larger-than-expected gain on the real estate portfolio; planning permission for the Blikastadirland asset triggered a positive revaluation – we see scope for further gains as the project progresses. Other positives were a widening of the net interest margin and good control of non-staff costs. An encouraging development is the likely resumption of the buy-back programme. W...
- Rahul Shah
Arion Bank: Q2 23 preview – Buy-back prospects improve, good news for ...
Arion Bank is scheduled to report Q2 23 results on 26 July (after market), with an investor call the following morning. We project net profit for the period of ISK5,885mn, versus the company-complied consensus of ISK6,308mn and the Q2 22 result of ISK9,712mn. Key positives include likely gains on the valuation of the Blikastadaland landbank, negative drivers include the challenging environment for the ISK165bn investment portfolio. Credit risk costs are once again a potential source of volati...
- Rahul Shah
Arion Bank: From capital distribution to capital build
Arion Bank has returned ISK87bn to shareholders since mid-2019, via a mix of buy-backs and dividends. This is a significant amount, equivalent to 44% of the current market capitalisation. At the same time, the bank has grown its revenue base by 20% over this period through improved pricing discipline and cross-selling. Operating efficiency has improved (revenues per employee are up 23%) and risks have been well-controlled. In addition, Arion Bank remains one of the best-capitalised banks in E...
- Rahul Shah
Arion Bank: Q1 23 results – Strong operating income but caution ahead
Arion Bank reported solid Q1 23 results, which were 1% above our estimate and exceeded most of the bank's medium-term targets. However, some the bank's forward-looking commentary is more cautious. Loan growth is expected to slow. The scope for margin expansion is limited, despite ongoing rate hikes. The bank has adjusted its IFRS risk models on more conservative assumptions. And the buy-back programme will likely not be renewed, meaning that Arion will operate above its medium-term CET1 targe...
- Rahul Shah
Arion Bank: Cost and capital discipline are key as credit demand slows...
Arion Bank will report its Q1 23 results on 4 May, with a management presentation the following day. We project net income of ISK6,195mn, compared to the company-compiled consensus of ISK6,158mn. Our forecast is presented at the end of this report. Looking ahead, we see more limited margin expansion and reduced credit demand, notably from households. The credit quality outlook seems benign, but this could change if central bank efforts to tame inflation precipitate a slump. Absent such a scen...
- Research Team
The Rear-View Mirror – EME markets: all indices gain in February, bar ...
EME Equity Market – February 2023 Market performance – Greece and Czechia continue with good momentum; Turkey resumes rally. The MSCI EM Europe Index gained 4.9% mom in EUR terms and 2.4% mom in USD in February. The Greek ASE and the Czech PX were, again, the best performers, adding 10.4% mom and 7.6% mom in EUR terms, respectively; while the rally resumed in Turkey, with the ISE 30 index gaining 7.3% mom in EUR terms. There was a somewhat muted performance in Hungary and Romania, with the BUX a...
EUROB EUROBANK ERGASIAS SERVICES & HOLDINGS SA
GARAN TURKIYE GARANTI BANKASI ANONIM SIRKETI
PEO BANK POLSKA KASA OPIEKI SA
JMT JERONIMO MARTINS SGPS S.A.
KRU KRUK S.A.
MOL MOL NYRT
EBS ERSTE GROUP BANK AG
CEZ CEZ AS
HTO HELLENIC TELECOMMUNICATIONS ORGANIZATION SA
RBI RAIFFEISEN BANK INTERNATIONAL AG
YKBNK YAPI VE KREDI BANKASI A.S.
OMV OMV AG
KOMB KOMERCNI BANKA A.S.
BHW BANK HANDLOWY W WARSZAWIE S.A.
BIMAS BIM BIRLESIK MAGAZALAR A.S.
DOAS DOGUS OTOMOTIV SERVIS VE TICARET A.S.
VER VERBUND AG CLASS A
SPL SANTANDER BANK POLSKA SA
MIL BANK MILLENNIUM SA
BSK ING BANK SLASKI S.A.
MTELEKOM MAGYAR TELEKOM TELECOMMUNICATIONS
TPS ORANGE POLSKA S.A.
PKN POLSKI KONCERN NAFTOWY ORLEN S.A.
MYTIL MYTILINEOS S.A.
ASELS ASELSAN ELEKTRONIK SANAYI VE TICARET A.S. CLASS B
BRISA BRISA-BRIDGESTONE SABANCI LASTIK SANAYI VE TICARET A.S.
LOGO LOGO YAZILIM SANAYI VE TICARET A.S.
CCC CCC SA
VESBE VESTEL BEYAZ ESYA SANAYI VE TICARET
TTKOM TURK TELEKOMUNIKASYON A.S.
MGROS MIGROS TICARET A.S
TBCB TBC BANK JOINT STOCK CO
TPEIR PIRAEUS BANK SA
CAR INTER CARS S.A.
ARCLK ARCELIK A.S.
AYGAZ AYGAZ A.S.
FROTO FORD OTOMOTIV SANAYI A.S.
OTKAR OTOKAR OTOMOTIV VE SAVUNMA SANAYI A.S.
THYAO TURK HAVA YOLLARI A.O.
TUPRS TURKIYE PETROL RAFINERILERI A.S.
EUR EUROCASH S.A.
GSPARK GRAPHISOFT PARK SE
11B 11 BIT STUDIOS S.A.
DAT DATAWALK SA
ALR ALIOR BANK SA
OTOEL AUTOHELLAS S.A.
BANK OF CYPRUS PCL
WPL WIRTUALNA POLSKA HOLDING SA
BELA JUMBO S.A.
SAB1L SIAULIU BANKAS
BRD BRD-GROUPE SOCIETE GENERALE
TLV BANCA TRANSILVANIA S.A.
TRP TERAPLAST
MONET MONETA MONEY BANK AS
SNG SOCIETATEA NATIONALA DE GAZE NATURALE ROMGAZ SA
SNP PETROM S.A.
TOFAS TOFAS TURK OTOMOBIL FABRIKASI A.S.
DIGI DIGI COMMUNICATIONS NV
DNP DINO POLSKA S.A.
NBGGY NATIONAL BANK OF GREECE S.A. ADS
SNN SOCIETATEA NATIONALA NUCLEARELECTRICA SA
TEL C.N.T.E.E. TRANSELECTRICA
ELSA SOCIETATEA ENERGETICA ELECTRICA
BVB S.C. BURSA DE VALORI BUCURESTI S.A.
GEB BANK OF GEORGIA
RICHT RICHTER
19XX NEPI ROCKCASTLE PLC
ALPHA ALPHA BANK
M MED LIFE
ADNOCDIST ADNOC DISTRIBUTION PJSC
SOKM SOK MARKETLER TICARET AS
NLBR NLB GROUP
TEN TEN SQUARE GAMES
KSPI KASPI KZ
INPST INPOST S.A.
PCF PCF GROUP SA
HUGE HUUUGE
WINE ALRO SLATINA
4IG PURCARI WINERIES PCL
IGN1L 4IG NYRT
ISB IGNITIS GRUPE
KCEL ISLANDSBANKI HF
CTPNV KCELL JSC
ONE ARION BANKI HF
GPP CTP NV
7202 ONE UNITED PROPERTIES SA
ELPE GRUPA PRACUJ DA
ARABIAN INTERNET & COMMUNICATIONS SERVICES CO
HELLENIQ ENERGY
- Rahul Shah
Arion Bank: Disciplined performance in the face of rising challenges
Arion Bank reported 2022 net income to shareholders of ISK25,440mn, down 11% yoy. This compares to the company-compiled consensus of ISK26,142mn and our own expectation of ISK26,853mn. Net interest income and net financial income were the key drivers of the shortfall. Following these results, we have trimmed our 2023 earnings forecast by 2% and our 2024 forecast by 8%. Our new fair value is ISK170 per share. The investment case for the shares hangs on Arion's continued commitment to returning...
- Research Team
WOOD Daily: ALPHA GA; ETE GA; EUROB GA; TPEIR GA; TL Strategy; SNG RO;...
HEADLINES: • Greek banks: heading for a bumper year (Alpha Bank, Eurobank, NBG and Piraeus Bank stay BUY) • Turkey strategy: Kahramanmaras earthquake - the aftermath • Romgaz: 4Q22 trading statement • Tupras: to pay dividend of TRY 45.41/share • Islandsbanki: 4Q22 highlights and further colour on potential merger with Kvika • Bucharest Stock Exchange: 4Q22 prelims - shaky end to the year, with inflation in the driving seat NEGATIVE • Poland macro: President Duda sends justice bill back to C...
MOL MOL NYRT
TPEIR PIRAEUS BANK SA
TUPRS TURKIYE PETROL RAFINERILERI A.S.
OTOEL AUTOHELLAS S.A.
SNG SOCIETATEA NATIONALA DE GAZE NATURALE ROMGAZ SA
NBGGY NATIONAL BANK OF GREECE S.A. ADS
BVB S.C. BURSA DE VALORI BUCURESTI S.A.
RICHT RICHTER
ALPHA ALPHA BANK
INPST INPOST S.A.
ISB ISLANDSBANKI HF
- Research Team
WOOD Daily: OMV AV; IS Macro; MBK PW; FROTO TI; AYGAZ TI; TUPRS TI; AR...
HEADLINES: • OMV: turning oil fields into yields (upgraded to BUY) • Iceland macro: MPC resumes its tightening cycle • mBank: solid 4Q22, very strong underlying profitability, pending further FX mortgage saga costs POSITIVE • Ford Otosan: 4Q22 results - strong beat POSITIVE • Aygaz: 4Q22 results review - net income beat, driven by Tupras POSITIVE • Tupras: 4Q22 results • Arion banki: 4Q22 highlights - slower margin momentum NEUTRAL • ADNOC Distribution: 4Q22 results - weak EBITDA, AED 0.103 d...
- Research Team
WOOD Daily: CTPNV NA; ALR PW; ISB IR; CCC PW; EU Energy; INPST NA; ALE...
HEADLINES: • CTP: attractive growth story, but high LTV a risk (HOLD - initiation of coverage) • Alior Bank: publishes key targets for 2023-24E strategy • Islandsbanki: thoughts on Kvika's letter on potential merger talks NEUTRAL • CCC: 4Q22 prelims - soft, as expected NEGATIVE • European Oil and Gas Monthly: January 2023 • InPost/Allegro: DHL and AliExpress joining forces in Poland NEGATIVE • Romgaz: new gas-fired power plant to be finalised in 2H24E • MOL: Hungarian National Bank approves ...
TPS ORANGE POLSKA S.A.
CCC CCC SA
TUPRS TURKIYE PETROL RAFINERILERI A.S.
ALR ALIOR BANK SA
BRD BRD-GROUPE SOCIETE GENERALE
SNG SOCIETATEA NATIONALA DE GAZE NATURALE ROMGAZ SA
DIGI DIGI COMMUNICATIONS NV
RICHT RICHTER
ALG ALLEGRO.EU SA
INPST INPOST S.A.
ISB ISLANDSBANKI HF
CTPNV CTP NV
SHO SHOPER SA
- Can Demir
WOOD Flash – Islandsbanki: thoughts on Kvika’s letter on potential mer...
Islandsbanki (ISB) has announced that it has received an offer from Kvika banki, to enter into merger talks. Kvika is an overall small player, with a stronger position in insurance and asset management than in banking. According to the release, Kvika’s motivation is to create a bank with a more optimal revenue mix. ISB’s board will review the letter to decide on the next steps this week. We believe it is premature to have a strong opinion on the merger, as key elements, such as valuation, taxati...
- Rahul Shah
Arion Bank: Key attractions remain despite investment portfolio headwi...
Arion Bank will report its full-year 2022 results on 8 February and hold its AGM on 15 March. In this note, we present our near-term estimates and look ahead to 2023 and beyond. On the back of our new projections, we update our fair value estimate to ISK185 (from ISK210 previously). The key driver of our valuation change is lowered investment portfolio return expectations. At our new fair value estimate, the shares would trade at 11.6x 2023 earnings and 1.6x tangible book value. INVESTMENT CA...
- Research Team
The Rear-View Mirror – EME markets: 2022 ends with Turkey still on top
EME Equity Market – December 2022 Market performance – Turkey closed the year by outperforming the other markets, yet again. The MSCI EM Europe Index gained 2.0% mom in EUR terms and 5.9% mom in USD in December. Turkey was, again, the best performer, with the ISE30 index adding 6.3% mom in EUR terms and 10.8% mom in local currency terms. Positive performances were recorded by the WIG20 (+3.1% EUR / 3.2% lcl mom) and the ASE indices (+1.9% EUR mom) as well. On the other side, the Hungarian BUX de...
MOL MOL NYRT
CDR CD PROJEKT S.A.
OMV OMV AG
COG COGNOR HOLDING SA
PKO PKO BANK POLSKI S.A.
PZU POWSZECHNY ZAKLAD UBEZPIECZEN SPOLKA AKCYJNA
DOAS DOGUS OTOMOTIV SERVIS VE TICARET A.S.
KGH KGHM POLSKA MIEDZ S.A.
TPS ORANGE POLSKA S.A.
PKN POLSKI KONCERN NAFTOWY ORLEN S.A.
MYTIL MYTILINEOS S.A.
LPP LPP S.A.
CCC CCC SA
DOM DOM DEVELOPMENT SA
AUG1L AGROWILL GROUP AB
PGSUS.E PEGASUS HAVA TASIMACILIGI AS
LVC LIVECHAT SOFTWARE SA
PPC PUBLIC POWER CORPORATION S.A.
OTP OTP BANK NYRT
CPS CYFROWY POLSAT SA
MBR MO-BRUK S.A.
OTOEL AUTOHELLAS S.A.
HB HELLENIC BANK LTD.
BELA JUMBO S.A.
SAB1L SIAULIU BANKAS
ETEL TELECOM EGYPT
BNET BITTNET SYSTEMS
HMX1R HANSAMATRIX AS
DNP DINO POLSKA S.A.
SNN SOCIETATEA NATIONALA NUCLEARELECTRICA SA
FP. FONDUL PROPRIETATEA S.A. GDR (REG S)
A4L ALLTERCO AD
RICHT RICHTER
NLBR NLB GROUP
TEN TEN SQUARE GAMES
ADKO ADDIKO BANK
KSPI KASPI KZ
HUGE HUUUGE
4IG 4IG NYRT
SHO SHOPER
PCO PEPCO GROUP NV
ISB ISLANDSBANKI HF
ONE ARION BANKI HF
GPP ONE UNITED PROPERTIES SA
GRUPA PRACUJ DA
- Research Team
WOOD Daily: ARION IR; ISB IR; OTP HB; LPP PW; US Macro; NLBR SV; ADKO ...
HEADLINES: • Icelandic Banks: the outliers (initiating on Arion banki with a BUY and Islandsbanki with a HOLD) • OTP Bank: should fare well, absent more negative events (upgraded to BUY) • LPP: 3Q22 below expectations on costs pressure; strong Black Friday sales; FY22E guidance maintained NEGATIVE • US macro: Fed sticking to its hawkish message • NLB Group: constitutional court annuls FX law • Addiko Bank: Slovenian Constitutional Court rejects retroactive Swiss Franc Law POSITIVE • Mytilin...
- Aidar Ulan
- Can Demir
- Miguel Dias
Icelandic Banks: the outliers (initiating on Arion banki with a BUY an...
Iceland resumed its journey as a frontier market last year. On our calculations, Arion banki and Islandsbanki have 1.4% and 1.0% respective weights in the MSCI Frontier markets index. We believe the Icelandic banks are a good way to diversify away from the EM/FM banks’ risks, which are tied to currency, interest rates, geopolitics and commodity prices. These banks have decent earnings power, despite their small scale and tightly regulated capital. The leverage on the banks’ balance sheets is as ...
- Rahul Shah
Arion Bank: Q3 22: Strong top line offset by investment losses, higher...
Arion Bank reported Q3 22 net profit to shareholders of ISK4,869mn, down 41% yoy, which was 20% below our expectation and 17% below the company-compiled consensus. The pre-tax result was 6-7% below our projections and consensus. The main reasons for the weak performance were negative net financial income, high insurance claims and a high effective tax rate. Key positives include the net interest margin, good cost control and high loan quality. The shares have declined 17% so far this year and...
- Rahul Shah
Arion Bank: Q3 22 preview: Robust core revenues but net financial inco...
Arion Bank will report Q3 22 results on 26 October, with an investor call the following day. We project the firm to deliver ISK6,802mn net profit, a creditable performance (13% ROE) given likely headwinds from weak net financial income – see the table below for more details. Key positive drivers include strong balance sheet volume growth (particularly from corporate clients), better net interest margins and healthy fee generation, allied to very low (negative) credit risk costs. We think the ...
- Rahul Shah
Arion Bank: Q2 results beat on higher revenues, low risk costs; capita...
Arion Bank reported Q2 22 net profit of ISK9.7bn, a rise of 24% yoy, in line with the company-compiled consensus but above our expectation of ISK8.3bn. Although the result from continuing operations was broadly in line (ISK2.9bn actual versus our ISK2.8bn estimate), results from discontinued operations surprised positively (ISK6.9bn against our ISK5.5 projection). Other key variances were fee income, risk costs and other operating income (positive); and financial income and taxation (negative...
- Rahul Shah
Arion Bank: Raising forecasts – Macro recovery drives stronger top lin...
We have raised our mid-cycle ROE estimate from 13.8% to 15.8%, which supports an increase in our fair value estimate from ISK180 to ISK210 per share. Key drivers of our more positive assessment include a stronger top line, helped by the rapid recovery of the Icelandic economy and Arion Bank’s successful cross-selling efforts. Greater exposure to mortgages is beneficial from a risk costs perspective. At our new fair value estimate, the shares would trade at 11.6x 2022 earnings and 1.8x book va...
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