Europlan IPO may be at the level of the largest in 2023

Kommersant’s sources expect the start of Europlan’s IPO next week and the placement of 10-15% of shares. The company will be of interest to both retail and institutional investors, experts believe, but high rates, competition and a “tight labor market” will be limiting factors in its valuation. The fair market price for Europlan is 60–80 billion rubles, that is, the IPO volume could be up to 12 billion rubles. and will be comparable to the largest placements of 2023.

Two Kommersant sources in the market expect the initial public offering of shares of the leasing company Europlan (100% owned by the investment holding SSFAI) to begin next week. Plans to hold an IPO on the Moscow Exchange in Europlan were officially announced on March 18. It is planned that the sole shareholder will offer investors the securities he owns, retaining a “predominant share” following the IPO results.

At the end of 2015, the Europlan company already held an IPO – 25% minus 1 share was sold for 3.27 billion rubles. (see “Kommersant” dated December 11, 2015). However, less than a year later, as part of the consolidation of assets, a financial holding company was created on its basis, later called Safmar Financial Investments (SAFAI), which became a public company. The leasing business was again separated into an independent legal entity, receiving the former name “Europlan”.

Experts call the company’s financial performance “quite high.” Europlan is steadily growing its portfolio at a double-digit pace; the results of past years “do not look like a one-time effect, but reflect a long-term strategy,” believes Evgeniy Shatov, partner at Capital Lab. “Financial companies are usually compared by their return on equity (ROE), which for Europlan is 37.7%, which is significantly higher than the industry average,” the expert clarifies.

Go Invest chief operating officer Sergei Rybakov notes that this will be “the only public player in the actively growing leasing sector on the Russian stock market.” He estimates the growth rate of the entire industry in the coming years at 15% per year.

Financial market participants believe that the company may be of interest to both retail and institutional investors. Investment strategist at Arikapital Management Company Sergei Suverov believes that the ratio will be approximately parity. According to Andrey Petrov, director of customer relations at BCS World of Investments, the company is “interested in a higher allocation to institutional investors.”

A portfolio manager of a large management company believes that Europlan “deserves a small premium to Sberbank for 2024 multipliers, taking into account higher expected growth rates.” However, he clarifies, given that the issuer will be in the second tier, where liquidity is limited, and adjusted for the IPO, an amount of 60–80 billion rubles looks relevant. Andrey Petrov expects this level to be the lower limit of Europlan’s estimate. According to another portfolio manager, the issuer wants to place with a valuation in excess of RUB 100 billion, which “looks somewhat overpriced.”

One of Kommersant’s interlocutors says that it is planned to place 10–15% of the shares, that is, the IPO volume will be up to 12 billion rubles. This is comparable to large placements last year – Eurotrans (RUB 13.5 billion) and Sovcombank (RUB 11.5 billion).

The main risks for the company lie in the area of ​​macroeconomics – high rates, income dynamics, a tough labor market, says General Invest portfolio manager Tatyana Simonova: “Europlan demonstrates higher margins, but it is important to understand whether it will be able to maintain it in the future.” Sergey Rybakov notes increased competition in the sector and regulatory factors.

Ksenia Kulikova, Vitaly Gaidaev, Polina Trifonova