PJSC Evropeiskaya Elektrotechnica Shares Admitted to Trading
PJSC Evropeiskaya Elektrotechnica Shares Admitted to Trading
PJSC Evropeiskaya Elektrotechnica, one of the leading companies providing comprehensive engineering services for the creation of electric power supply systems, energy saving, and electric lighting systems for industrial facilities, has signed a listing agreement with the Moscow Exchange. Shares of PJSC Evropeiskaya Elektrotechnica were admitted to trading and included in the third level list of securities on August 7, 2017. The assumed starting price for investors is RUB 10 a share.
The funds raised from the share placement will be used to implement the company’s 5-year strategy for developing the network of engineering centers and purchasing production assets.
RAEX, an independent agency, rated PJSC Evropeiskaya Elektrotechnica as ruB, outlook Stable. Analysts note a forecasted high liquidity level for the company. The company's wide geographical footprint, high sales diversification, and moderately low dependency on counterparties are the key factors that contributed positively to the rating score. The diversified contract base of PJSC Evropeiskaya Elektrotechnica is oriented on large participants of the mining industry and the power sector.
MZ LLC (Conomy.ru) conducted an independent evaluation of the company's business value. The issuer's fair value was estimated based on the provided published and internal documentation. It amounts to RUB 6.8 billion, or RUB 11.04 a share. According to analysts, Evropeiskaya Elektrotechnica is developing intensively, as reflected by the company’s indicators of financial growth over recent years. The company has an advantage over Russian counterparts thanks to its large order portfolio, which ensures stable work and high financial results, and practically a total absence of debt.
PJSC Evropeiskaya Elektrotechnica is planning to start trading on MOEX at the beginning of September. The organizer of the share placement is IT Invest, the underwriter. It is planned to place 16% of all PJSC Evropeiskaya Elektrotechnica shares. The company's dividend policy assumes a payout of 20% of net profit as per International Financial Reporting Standards.
The electric power supply market is strategically important for the state, and its size within the segment of industrial enterprises is forecasted to be RUB 600 billion in 2017. For the next five years, PJSC Evropeiskaya Elektrotechnica’s order portfolio amounts to RUB 36.3 billion, with target revenue of RUB 41.9 billion. At the moment, the order portfolio covers 87% of the company's needs for projects. Currently, the company owns a chain of eight engineering centers. By 2020, the chain will include 17 centers, with each of them bringing in at least RUB 100 million during their first years of operation. Evropeiskaya Elektrotechnica has an excellent business reputation and a pool of licenses and certificates which allow the company to work on strategically important federal projects.
Joel Lautier, the founder of RGG Capital and a member of the Board of Directors of the Franco-Russian Chamber of Commerce and Industry, believes that placement of Evropeiskaya Elektrotechnica shares on the stock exchange is a brave and wise decision at the company’s current development stage. The company's revenue has been increasing significantly over the last four years, and profit margin under EBITDA has also been gently growing. Meanwhile, the company’s debt load is quite small. These indicators clearly show that the company is managed by an excellent team. Furthermore, the company's market is stable thanks to necessary infrastructure investments for renovation in both Russia and other countries where the company operates.
Lautier adds: “Going public will give the company a powerful impulse for promoting its brand, which will help the company to take leading positions within the sector. Thus, the company will get on the same road to success following Western companies that placed their shares on the stock market in order to become market leaders, as it was with the French company Rexel, which later became a world leader in the sphere.”
Evropeiskaya Elektrotechnica has been operating since 2004. The company's revenue amounted to RUB 3.85 billion for 2016.