| The Group, in the consolidated half-yearly financial report as of 30 June 2023, announced that it had generated revenues of € 2.28 million, up 55.2% compared to the half-yearly figure of 2022, equal to € 1.47 million. The EBITDA recorded a value of € 0.48 million, a strong growth (+156.3%) compared to 1H22A, in which it was equal to € 0.19 million. The EBITDA margin it stands at 16.5%, compared to a figure of 10.6% for the same half of the previous year. The EBIT is equal to € 0.33 million, an increase compared to 1H22A, equal to € 0.17 million. The EBIT margin, similarly, grew from 9.7% in 1H22A to 11.6% in the first half of 2023. Net Income, at the end of 1H23A, stood at € 0.17 million, a slight increase compared to to the first half of 2022 (+15.2%). The NFP at 1H23A, equal to € 0.32 million of debt, worsened compared to the value of the previous annual report ( cash positive of € 0.16 million). In light of the results published in the semi-annual report for 1H23A, we modify the estimates for both the current year and the coming years. In particular, we estimate the FY23E production value of € 6.55 million and an EBITDA of € 2.55 million, corresponding to a margin of 38.9%. For the following years, we expect the value of production to increase up to €14.50 million (CAGR 22A-25E: 43.8%) in FY25E, with EBITDA equal to € 5.95 million (corresponding to a margin of 41.0%), up compared to € 1.84 million in FY22A (corresponding to an EBITDA margin by 37.7%). Given the lack of comparable companies, we conducted our valuation of the equity value of Franchetti based on the DCF method alone. The DCF method (including, for prudential purposes, a specific risk of 2.5% in the calculation of the WACC) returned an equity value of € 49.2 million. The target price is € 7.20, BUY rating, and MEDIUM risk. |