Από τα γραφεία των Χρηματιστών (26.02.2024)

ATHEX headed south on Friday for a 3^rd session in a row, underperforming the European stock markets. In more detail, the General Index fell by 0.42% at 1,413.26 units (FTSE Large Cap: -0.42%, FTSE Mid Cap: -0.64%, Banks Index: -0.51%) and the traded value was shaped at EUR 109.6m, down from Thursday’s EUR 110.5m. On a weekly basis, the General Index gained 0.56% w-o-w (FTSE Large Cap: +0.52%, FTSE Mid Cap: -0.27%, Banks index: +0.52%). We expect ATHEX to consolidate at current levels today. We remind you that Ideal Holdings reports FY 2023 results on Wednesday 28 February as well as HELLENiQ Energy and Entersoft on Thursday 29 February.

Company Headlines

Hellenic Bank 2023 results, EBT beat guidance

EBT came in at EUR 393.6m, well above revised FY guidance of EUR 350.0m in 9M23 and net profit came in at EUR 365.4m from EUR 21.8m in 2022, bolstered by higher revenues (+65% y-oy), efficient cost control (-5% y-o-y) and lower LLPs (-54% y-o-y). Net interest income came in at EUR 536.3m (+78% y-o-y) and NIM widened to 2.75% in 2023 vs. 1.60% in 2022. RoTE skyrocketed to 27.1% in 2023 from 8.6% in 2022. Tangible equity was shaped at EUR 1.46bn and Pro forma CET1 ratio at 22.8%. Net loans reached EUR 6.02bn, deposits EUR 15.3bn and assets EUR 20.06bn. Project Starlight was completed as planned. The transaction has significantly de-risked the balance sheet by around EUR 700m, with the NPE ratio, excluding the NPEs covered by the Asset Protection Scheme, reduced to a low 2.5%. The news is positive on Eurobank. We reiterate our Buy rating and TP of EUR 2.41/share.

OTE Share buyback program to commence today

The company announced that the new share buyback program of EUR 153.0m will be executed from 26 February 2024 to 21 January 2025. OTE currently holds 1,926,507 own shares, acquired in the context of implementation of 2023 Share Buy Back Programme, which it intends to cancel following the approval of the next Shareholders General Meeting.

Minister of Energy to allow the first price increases for Athens Water (press)

According to press reports, a ministerial decision expected in the next months, will pave the way for Athens Water to proceed with price increases on its water and sewage charges through its network in Athens, a first price increase after 13 years.

Intralot raised EUR 130m through the issue of common bond loan

The company announced that it successfully raised EUR 130m through the issue of a common bond loan with a duration of five years. The final yield and the bond’s interest rate were set at 6.0%. The total valid demand from investors that participated in the Public Offering was EUR 201.9m, resulting in an oversubscription by 1.55x. The bonds will commence trading in the Fixed Income Securities of the Regulated Market of the Athens Exchange on Wednesday 28 February.

AS Company Share purchase programme initiation

AS Company announced that it will today commence a share buyback programme that will be valid until 23 June 2026. The company will purchase up to a maximum of 656,301 shares or 5% of the total share capital with a price range from EUR 0.50 to EUR 4.00 per share.

The ASE Benchmark Index dropped 0.42% on Friday on EUR 111m ADTV. Mixed performance for the banking sector (Piraeus and Alpha with losses of >1%, Eurobank and NBG with marginal gains). Uninspiring session for most of the non banks, with Piraeus Port Authority being the best performer, recording gains of 1.2%. Correction for Sarantis, down 1.7%, after a strong year-to-date rally (+14% ytd vs ASE +9.2%).

MACRO

BoG Governor mentioned in a Bloomberg interview that the first rate cut decision could be made in June.

EUROBANK <EUROB GA, OW>

Hellenic Bank reported on Friday morning FY23 net profits of EUR 346.3m with a ROTE of 27.1% vs. 8.6% in 2022. The results were driven by the 78% uplift in NII due to higher income from placements with the central bank (EUR 7.3bn ex TLTRO) and debt securities (EUR 5.1bn), and to a lesser extent from loans, offset by higher interest expenses on MREL. Bottom-line was also aided by the 5% yoy reduction in opex following the completion of the VRS plan in 2022 and the low COR (24bps). All in, the bank reported very strong results and ahead of the pre-tax profit guidance of EUR 350m provided after the 9M23 results. Hellenic Bank has a very liquid balance sheet (L/D ratio of 39%), low NPLs (NPE ratio of 2.5%) and a huge capital position (CET1 ratio at 22.8% and Total Capital Ratio at 28.4%). Hellenic Bank shares currently trade at EUR 2.32/share and close to the recent SPAs that Eurobank has agreed with key shareholders (EUR 2.35/share) in order to reach a 55.3% stake. We remind that Eurobank currently holds 29.2% of Hellenic Bank and has agreed to increase its holding to 55.3%, subject to regulatory approvals. On Feb 2, the Commission for the Protection of Competition approved the market concentration and the final pending approvals is now from the central bank and the ECB. Once all approvals have been taken, Eurobank is required to proceed with a tender offer for the minorities. Out of the remaining 44.5% stake, Demetra Holdings owns 21.3% with the remaining is the free float.

On the 2023 numbers the shares trade at 2.8x P/E and a P/TBV of c.0.65x. The management guided for a sustainable level of ROTE of c.13% (which implies a net profit of c.EUR 200m). All in, we view Eurobank’s acquisition of Hellenic Bank as very positive and expect a strong contribution to group profitability on full consolidation. Eurobank is reporting FY23 results and a Business Plan 2024-2026 on the March 7 and we would expect more colour on the process.

 HELLENIC TELECOM <HTO GA>

OTE announced the launch of the own share buyback program to be executed from Feb 26, 2024 to Jan 21, 2025 with a size of c.EUR 153m. The own share will be purchased exclusively for cancellation.

The plan is in line with the recently announced renumeration policy.  

INTRALOT <INLOT GA>

The total demand from investors that participated in the issuance of the common bond loan was EUR 201.9m (an oversubscription of 1.55x). The final yield was set at 6.0% and the bonds were allocated as follows: a) 76.92% to retail investors, and 23.08% to qualified investors.

ATHENS WATER <EYDAP GA>

Reportedly, the Ministry of Finance on recommendation from the water regulator will agree to an increase in the prices for EYDAP (first increase after 13 years).

*Eurobank Equities (https://www.eurobankequities.gr)

 

Market Comment // The ASE General index experienced its third consecutive decline on Friday, dropping by 0.42% finishing at 1,413.26 points. In terms of trading activity, turnover remained slightly below the €110mn mark and lower than the 100-day MA of €119mn. Among laggards, ElvalHalcor led losers tumbling -2.1%, followed by Sarantis (-1.8%), Entersoft (-1.8%), Alpha (-1.5%), Hellenic Exchanges (-1.3%), and ADMIE (-1.3%). Conversely, Papoutsanis (+1.7%) and Kri-Kri (+1.4%) topped the leaderboard, followed by Autohellas (+1.0%), Ideal and Ellaktor (+0.9%), while Aegean Airlines (+0.8%) and CCH (+0.7%) also finished in the green. Today markets are headed for a negative opening, as risk-on mood fades ahead of critical US inflation data this week which will shape policy expectations in the near term.

MSCI // Flow following latest index review to take place on the close of Thursday 29th February. As a reminder, there were no changes in the MSCI Greece Standard Index, which consists of 10 stocks, namely OTE, OPAP, Jumbo, PPC, Eurobank, Alpha Bank, NBG, Piraeus Bank, Mytilineos and Motor Oil. On the other hand, there were 2 additions in the MSCI Greece Small Cap Index, namely Intralot and Intrakat.

HelleniQ Energy // The management of HelleniQ Energy has been holding meetings with institutional investors, as the main shareholders seem to be keen to proceed with a second private placement to increase the free float.

IDEAL Holdings // IDEAL is due to release its FY’23 results on Wednesday 28 Feb pre-market opening; we estimate pro forma adj. EBITDAaL at €55.1m (+18% vs. FY’22) and pro forma revenue at €394.9m (+9% yoy) underpinned by solid growth in Specialty Retail and IT.

Entersoft // Entersoft is due to release FY’23 results on Thursday 29 Feb pre-market opening; we anticipate revenue growth of 31% (€38.8m) and EBITDA of €12.5m (up +31% yoy) on flat EBITDA margin of c32%.

Coca-Cola HBC // CCH announced the final terms of the €600m note to be issued under its €5m EMTN program. The notes have a 4-year maturity (up to 27 Feb 2028) and a fixed 3.375% rate.

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