abitare in...jul 21, 2020 · company profile 4 company overview 4 company’s board 5 shareholder...

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Abitare In

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Investment Research Italy | Financial Services Industrials Full Company Report Reason: Initiation of coverage 21 July 2020

Key financials (EUR) 09/19 09/20e 09/21e

Sales (m) 45 102 138

EBITDA (m) 11 16 35

EBITDA margin 25.5% 16.1% 25.6%

EBIT (m) 11 16 35

EBIT margin 24.3% 15.5% 25.1%

Net Profit (adj.)(m) 6 9 22

ROCE 10.2% 14.2% 21.5%

Net debt/(cash) (m) 32 27 41

Net Debt Equity 0.7 0.5 0.5

Net Debt/EBITDA 2.8 1.6 1.2

Int. cover(EBITDA/Fin.int) 8.4 7.8 13.6

EV/Sales 3.5 1.2 1.0

EV/EBITDA 13.6 7.8 4.0

EV/EBITDA (adj.) 13.6 7.8 4.0

EV/EBIT 14.3 8.1 4.1

P/E (adj.) 19.5 11.1 4.8

P/BV 2.6 1.8 1.3

OpFCF yield -18.4% 5.0% -13.8%

Dividend yield 0.0% 0.0% 0.0%

EPS (adj.) 2.48 3.60 8.40

BVPS 18.46 22.07 30.47

DPS 0.00 0.00 0.00

Shareholders

Luigi Francesco Gozzini 24%; Marco Claudio Grillo 18%; Kairos partners 6%;

Analyst(s)

Francesco Sala

[email protected]

+39 02 4344 4240

Gian Marco Gadini

[email protected]

+39 02 4344 4236

A new way to build new houses AbitareIn focuses on developing sustainable and efficient residential projects in Milan. The company has a unique business model that minimises the developing risks, especially from the financial standpoint, and is able to offer its clients a fully tailor-made home. A large pipeline of projects gives the company an edge on competitors and a high degree of flexibility.

✓ Founded in 2015, AbitareIn is an industrial company that operates in the real estate sector. It develops residential projects in Milan by converting abandoned factories or industrial complexes and offering customisable homes. The sites are located within the semi-centre perimeter of the city, areas that make up the affordable segment of the market: prices range from EUR 3,000 to EUR 5,000 per sqm. AbitareIn has developed a unique business model and can offer its clients a tailor-made home while benefiting from economies of scale. The area selection, the authorization phase, the project structuring and the commercialization are done completely in-house (the know-how is completely the company’s own), while the construction is contracted out to third-party companies through a procurement contract. In this respect we highlight that the construction activity, for residential buildings, is not particularly risky since the final “product” is rather simple.

✓ The group operates through Special Purpose Vehicles (SPVs) fully-owned by the parent company in order to ring-fence the financial risk. AbitareIn establishes a dedicated company for each development project in order to eliminate any mutual dependence between projects. Each SPV can only use mortgage loans. This restriction further improves the group’s financial stability. Each mortgage loan is accompanied by the SPV’s commitment not to start the construction work before it has collected a number of purchase proposals or preliminary sales contracts for at least 70% of the expected number of real-estate units. However, we highlight that the company has always started the construction phase with a higher number of preliminary sales contracts (close or equal to 100% of the units).

✓ AbitareIn has sold (preliminary contracts) around 650 apartments, for a total of EUR 249.9m. The company is currently completing 5 projects (all sold), for a total of around 66,000 commercial sqm (with an average selling price of around EUR 4,250 per sqm). These 5 projects are expected to be completed by the end of 2022. The company has recently launched the commercialization of the “SAVONA105” project, totalling around 19,500sqm, and a new project will be launched by the end of this year.

✓ One of the company’s most important features is its large pipeline of projects. AbitareIn has signed preliminary and final agreements to purchase plots of land, around 233,000 commercial sqm, equal to 2,530 “standard-size” apartments, at an average price of EUR 625/commercial sqm. It is worth noting that the pipeline is mainly made up of “brownfield sites”, consisting in dismissed industrial or commercial facilities. The company manages internally the planning, the authorization process and the remediation works. This approach allows the company to operate in a less crowded market and obtain lower prices. The drawback is that the authorisation and development process is longer and more uncertain. However, the company’s expertise in completing the authorisation process and developing the area offsets the risks. Furthermore, a large pipeline reduces the risks of a single area being developed more slowly than expected.

✓ Abitarein is only engaged in “urban regeneration projects”, redeveloping disused or abandoned sites by transforming them into new, modern, sustainable and efficient residential buildings.

✓ We initiate the coverage with a Buy recommendation and a EUR 54.0/sh target price.

Buy

40.00closing price as of 20/07/2020

54.00

35.0%Upside/Downside Potential

Initiating Coverage

Target price: EUR

Share price: EUR

Downloaded: 2020-07-21 09:50 User: Sala Francesco (BANCA AKROS)

Abitare In

CONTENTS

Investment Case 3

Company Profile 4

Company overview 4

Company’s board 5

Shareholder structure 6

Business model 7

One project, one vehicle and no recourse to debt 7

Key elements of the development process 8

Marketing 9

Property technology 9

Real Estate Market in Milan 10

Demographic framework 10

Tourism is affecting the supply of houses 11

Milan urban development 11

COVID-19 outbreak impact 12

Ongoing projects and pipeline 13

Main ongoing projects 14

AbitareIn Maggiolina -100% sold 14

Milano City village – 100% sold 15

Milano Trilogy – 100% sold 16

Projects expected to start in the next few months 17

Naviglio Grande –Palazzo Naviglio 17

Via Savona project 18

Corvetto/Olimpia Garden 19

Business plan and pipeline 20

Strong pipeline implies good visibility on targets 21

HOMIZY – co-living 22

Valuation 23

Estimates 24


Abitare In

Investment Case

Founded in 2015, AbitareIn is an innovative industrial company that operates in the real-

estate sector. It develops sustainable residential urban building projects in Milan by

converting abandoned factories or industrial complexes and offering highly customisable

homes. The sites are located within the semi-centre perimeter of the city (the so called “belt”),

areas that make up the affordable segment of the market: prices range from EUR 3,000 to

EUR 5,000 per square metre.

AbitareIn has developed a unique business model and can offer its clients a fully tailor-made

home while benefiting from economies of scale. The area selection, the authorization phase,

the project structuring and the commercialization are done completely in-house (the know-

how is completely the company’s own), while the physical construction of the property is

contracted out to a third-party operator through a procurement contract.

The group operates through Special Purpose Vehicles (SPVs) fully-owned by the parent

company (AbitareIn) in order to ring-fence the financial risk. Thus, AbitareIn establishes a

dedicated company for each development project in order to eliminate any mutual

dependence between projects. It is also worth mentioning that each SPV can only use

mortgage loans and cannot take on any debt. This restriction on financial debt improves the

group’s financial stability even further.

Each mortgage loan is accompanied by the SPV’s commitment not to start the construction

work before it has collected a number of purchase proposals or preliminary sales contracts

for at least 70% of the expected number of real-estate units.

However, we highlight that the company has always started the construction phase with a

much higher number of preliminary sales contracts, close or equal to 100% of the expected

number of units.

The company is currently completing 5 projects (all sold), for a total of around 66,000

commercial sqm (with an average selling price of around EUR 4,250 per sqm). These 5

projects are expected to be completed by the end of 2022. The company has recently

launched the commercialization of the “SAVONA105” project, totalling around 19,500sqm,

and a new project will be launched by the end of this year.

One of the company’s most important features is its large pipeline of projects. AbitareIn has

signed preliminary and final agreements to purchase plots of land, around 233,000

commercial sqm, equal to 2,530 “standard-size” apartments, at an average price of EUR

625/commercial sqm. It is worth noting that the pipeline is mainly made up of “brownfield

sites”, consisting in dismissed industrial or commercial facilities. The company manages

internally the planning, the authorization process and the remediation works. This approach

allows the company to operate in a less crowded market and obtain lower prices. The

drawback is that the authorisation and development process is longer and more uncertain.

However, the company’s expertise in completing the authorisation process and developing

the area offsets the risks. Furthermore, a large pipeline reduces the risks of a single area

being developed more slowly than expected.


Abitare In

Company Profile

Company overview

Founded in 2015, AbitareIn is an industrial company that operates in the real-estate sector. It

develops sustainable residential projects in Milan by converting abandoned factories or

industrial complexes and offering highly customisable homes. The sites are located within the

semi-centre perimeter of the city, areas that make up the affordable segment of the market:

prices range from EUR 3,000 to EUR 5,000 per sqm. The company’s commercial strategy

moves the focus from the price (per square metre) to the functional value and sustainability

of the housing solutions by offering fully tailor-made homes: the client can model internal

spaces, finishes and furniture to their needs and personal preferences.

Thanks to its knowledge of the real-estate sector, and its high degree of innovation,

information and specialisation, AbitareIn has developed a unique business model and can

offer its clients a fully tailor-made home, while benefiting from economies of scale, a

characteristic of industrial models. The area selection, the authorization process, the project

structuring and the commercialization are done completely in-house (the know-how is

completely the company’s own), while the construction of the property is contracted out to a

third-party operator through a procurement contract.

AbitareIn’s development projects have all reported good performances so far, even during

the real-estate sector crisis. The group has developed a product and a marketing strategy

based on branded activities, innovation technology and advanced customer service

experience.

According to the management, these are the key success factors of AbitareIn’s business

model:

✓ the group operates in the semi-central area of Milan and targets the so-called

“affordable” segment of the real-estate market;

✓ investments on innovation, high specialization and computerization;

✓ focus on “families” and “first house” market;

✓ the careful selection of the building area through an in-depth analysis aimed at

reducing risks and defining commercial opportunities;

✓ efficient communication and marketing schemes designed to maximise sales

opportunities before and during the construction. This is the so-called “off-plan” sale

of residential properties;

✓ the ability to offer its clients a highly customizable house, even during advanced

phases of the real-estate project, thanks to efficient project structuring and the

employment of the Building Information Modelling (BIM) platform;

✓ strong attention to clients’ queries and needs throughout the whole process:

purchase, customisation, delivery of apartments upon property completion and post

sales;

✓ full transparency with the market and shareholders;

✓ the management’s solid track record, which is characterised by a significant

experience in the Milan real-estate market, as well as in innovative and highly

competitive industries.


Abitare In

Company’s board

Luigi Francesco Gozzini (Chairman). After graduating from the University of Milan and

obtaining an MBA from Bocconi University, Mr Gozzini became an Associate Consultant in

McKinsey and worked in the financial sector for the Ministry of Finance, Unicredit, San Paolo

di Brescia and Banca Popolare di Brescia. He took part in the merger of Cariplo – Banco

Ambrosiano Veneto, which led to Banca Intesa. He co-founded the airline company Gandalf

Airline and then focused on real estate by establishing Gruppo Immobiliare T and,

subsequently, AbitareIn.

Marco Claudio Grillo (CEO). After getting his degree in computer science from the University

of Milan, Mr Grillo held a number of business and executive positions in Italian and

multinational companies (including Dell). In 2005, he founded a data security start-up then

acquired by a leading US provider of networking security provider. Following the acquisition,

he was appointed CEO of a security network company, later sold to a German private equity

fund. Before moving into the property sector, he was appointed by the board of directors as

advisor for the sale of Matrix S.p.A. to Libero. He then co-founded AbitareIn with Mr Gozzini.

Luca Manara (Board Member). A civil engineer from the University of Parma, specialised in

construction engineering, Mr Manara held various position in Pizzarotti & C. S.p.A., including

Technical Services Manager (2002-2003) and Property Development Manager (2003-2013).

From 2013 to 2016 he was appointed Managing Director of the Property Development Sector

in Italy.

Mario Benito Mazzoleni (Independent Board Member). After graduating from Bocconi

University with a degree in Business Administration, with a major in Economics of Public

Administrations, he pursed a career in academia. He was an Associate Professor of Business

Administration at Bocconi University, where he served as Director of the MBA programme

from 1992 to 2004. He then took on several roles at the University of Brescia, such as

Supervisor of the Strategy Course, Administrator of the Master of SMEs (2010) and Director

of the Master in Management and Business Innovation (2015). In addition, he is a member of

the scientific committee of three management magazines: “Development & Organization”,

“The Enterprise” from Il Sole 24 Ore, and Giuffrè’s “Public Enterprise”.

Giuseppe Vegas (Independent Board Member). After obtaining a degree in law in 1973,

Mr Vegas first served as an official of the Senate and subsequently appointed State Secretary

for Finance and State Secretary for the Treasury. He was elected to the Senate three times

(1996, 2001, 2006) and to the Chamber of Deputies once (2008). From 2001 to 2006, and

from 2008 to 2010, he was also appointed State Secretary for the Economy and Vice Minister

for the Economy. He served as Chairman of Consob (2010-2017), as well as adjunct

professor at the University of Parma, University of Milan, and the Catholic University of the

Sacred Heart. Currently, he is a director in a number of companies (such as Techedge SpA,

Ucapital 24 SpA, Officine CST SpA, Selfiewealth Srl) and chairman of Arisk Srl.


Abitare In

Shareholder structure

AbitareIn has a total of 2,570,808 shares. The main shareholders are:

✓ Luigi Francesco Gozzini with 23.4%;

✓ Marco Claudio Grillo with 18.1%;

✓ Kairos Partners SGR S.p.A with 5.9%;

✓ Gaudenzio Roveda with 5.0%.

The company has been listed on Borsa Italiana’s AIM market since April 2016 and is included

in the Register of Innovative SMEs (“PMI Innovative”), a special register reserved for SMEs

that meet defined technological innovation requirements. On January 15th 2020, the Board of

Directors approved the transition from the AIM market to the STAR segment of the MTA

market managed by Borsa Italiana S.p.A. We believe the listing on the STAR segment will

contribute to improving the company’s perception among investors and pave the way for the

company to access new institutional and international investors.

Shareholder structure

Source: Company Data


Abitare In

Business model

One project, one vehicle and no recourse to debt

The group operates through Special Purpose Vehicles (SPVs) fully-owned by the parent

company (AbitareIn) in order to ring-fence financial risk. Thus, AbitareIn establishes a

dedicated company for each development project in order to eliminate any mutual

dependence between projects. The special-purpose entity is responsible for managing all the

phases of the real-estate project. When the property construction is completed, there is no

inventory of unsold homes, the SPV is closed and dividends are distributed to the parent

company.

It is also worth mentioning that each SPV can only use mortgage loans and cannot take on

any debt. This restriction on financial debt further improves the group’s financial stability.

Group structure

Source: company presentation


Abitare In

Key elements of the development process

There are six main drivers, each of which plays a pivotal role in the success of each real-

estate project.

✓ Area selection

The selection of the prospective building area is the result of careful screening of

opportunities using socio-economic, demographic and supply-demand parameters.

The portfolio of opportunities is mapped out by the Business Development and Market

Intelligence team by conducting rigorous and extended activities.

✓ Implementation authorisation and sustainability

All projects are urban regeneration projects with low authorisation and environmental

risks because they involve the demolition and redevelopment of existing buildings.

✓ Commercial strategy

AbitareIn highly innovative commercialisation programmes do not entail discounts on

prices, but carry time-limited promotions and special offers that are only announced

at promotional events organised throughout the development of the project.

✓ Financing structure

The main funding sources are mortgage loans, customers’ down-payments and

positive working capital. Mortgage loans account for the majority of the financed

costs, such as planning and construction fees. The amount of the loan is set as a

percentage of the expected cost of the newly built property. At the end of the

construction work, the mortgage is handed over to the clients, who benefit from lower

interest costs. A distinctive feature of AbitareIn’s business model is that construction

work is subject to the successful completion of the pre-sale phase. For this reason,

the project can rely on costumers’ down-payments, amounting to, approximately,

30% of expected revenues. Moreover, the commissioned builder is paid at 90 days

from the first day of the month after the month in which the work in progress status is

approved, thus resulting in positive working capital. 10% of the total amount due is

withheld as a “performance bond” against bad execution, and paid to the builder

within 18 months from the approval of the final work in progress status.

✓ Relation with the construction firm

The property development is commissioned to third parties through procurement

contracts. Eligible real-estate developers are selected based on requirements such

as: a) sector references in similar projects; b) financial sustainability; and c) execution

warranties. This approach ensures, among other benefits, a considerable reduction

in operating risks.

✓ Target client base

AbitareIn offers housing solutions that are primarily targeted to families interested in

buying their first home in Milan. Prices range from EUR 3,000 to EUR 5,000 per

square metre, which represent the affordable segment of the real-estate market in

Milan. In order to better identify the target client base of each property project,

communication and advertising campaigns are run within a one-kilometre radius

around the building area, thereby allowing for a greater understanding of habits and

socio-demographic trends in the selected neighbourhood.


Abitare In

Marketing

AbitareIn relies heavily on its innovative marketing approach, which was inspired by the

successful experience and business model of international players like Telford Homes, Nexity

and Redrow. The group was able to build an effective commercial strategy based on three

main pillars.

✓ Commercial campaigns

Each real-estate project is generally advertised through a first advertising campaign

during the pre-sale phase, and three additional campaigns during the

commercialisation and development phase. Commercial campaigns are typically

directed at a target market cluster and are characterised by promotions specifically

addressed to the reference market cluster. The campaigns differ from each other and

depend on sales performances and the down-payments collected. Participation in a

promotional event entitles the client to access the promotion advertised in that same

advertising campaign.

✓ Showrooms and virtual reality

Showrooms are commercial spaces set up on the premises of the selected building

area. They also serve as commercial offices and venues for promotional events.

Furthermore, by using the latest cutting-edge technology, customers’ purchase

experience is enriched by the technological development of Virtual Reality. The

showrooms have evolved to 4.0.

✓ Customer loyalty

Customer loyalty and retention are a strategic priority for AbitareIn. Loyalty

programmes can be broken down into four main activities: (i) the sending of

newsletters containing project updates, new opportunities, relevant information and

in-depth analyses; (ii) invitation to promotional events; (iii) advertising campaigns

specifically addressed to current customers. Communication and advertising are

carried out extensively through social media. In particular, dedicated websites and

social network accounts (such as Facebook and Instagram) are created for each

real-estate project. Website and social account visits are monitored in order to

measure how effective the communication campaign is.

Property technology

AbitareIn’s business model requires extensive use of information technology. An advanced

and efficient IT infrastructure grants the group a competitive advantage in the Italian real-

estate market. In this regard, the heart of each initiative is “PRODECTO” (Project

Development for Construction to Order), a sort of enterprise resource planning platform that

was developed by AbitareIn itself and is based on BIM technologies (Building Information

Modeling - BIM) and integrated with the Salesforce platform. Construction plans are outlined

in the platform, from the design phase to the construction phase up to the use and

maintenance phases. PRODECTO encompasses all technical information regarding the

buildings, such as the detailed geometry, installations, property of the materials, components,

systems and technical elements, implementation phases, maintenance operations and

disposal at the end of the cycle. Moreover, the entire sale process is managed through

Customer Relationship Management (CRM) platforms. Thanks to the centralisation and

pooling of clients’ data, the salesforce platform has provided AbitareIn with a stronger

involvement of all the business functions that take part in the sale process regarding legal,

financial, administrative, technical and planning matters.


Abitare In

Real Estate Market in Milan

Demographic framework

Milan is growing faster than the rest of the country. The city is experiencing positive

demographic expansion, unlike the rest of Italy, which sees people moving from the suburbs

to the main city in order to benefit from its high living standards.

This premise is supported by the data from the Integrated Statistic System of Milan, which

shows an increase of more 100,771 residents in the last decade, jumping from 1.29 million in

2008 to 1.40 million in 2018. This positive trend is expected to continue in the next decade.

Assuming a highly positive scenario (high), a positive scenario (medium), and a slightly

positive scenario (low), the estimated number of residents in 2030 is 1.53 million, 1.47 million,

and 1.44 million, respectively.

Another important indicator of the demographic transformation is the rejuvenation of the

population structure of Milan: the number of residents aged 35-44 is decreasing, while the

number of residents aged 19-34 is increasing. Young residents have moved into the city in

order to pursue their education and careers. This is clearly a driver for new home sales.

Residents and NTN (2007-2018) Estimated number of residents (2019-2030)

Source: Integrated Statistic System of Milan, Internal Revenue Agency

Residents by age Family units (2007-2018)

Source: Integrated Statistic System of Milan, ISTAT

180,000

200,000

220,000

240,000

260,000

280,000

300,000

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

Age 19-34 Age 35-44


Abitare In

Tourism is affecting the supply of houses

We also point out that the number of houses being rented as tourist accommodation has

grown steadily in the last few years. This clearly puts pressure on the supply side of the

market by reducing the number of houses available for residents.

Number of “rented beds” for touristic purposes in Milan

Source: Integrated Statistic System of Milan

Milan urban development

In the last two decades, Milan has undergone important projects to renew the urban fabric

and improve the infrastructures, such as railway connections and underground lines. It is

worth mentioning that when Milan hosted the World Expo 2015, major city redevelopment

plans were implemented, such as for the Darsena district. Between 2000 and 2020, two

renowned projects were launched: Porta Nuova (2004-2014) and CityLife (2004-2018). All

these urban redevelopment schemes have attracted national and international capital and

increased the number of residents and visitors.

Over the next decade, the “Milano 2030” government plan sets challenging targets.

✓ The development of the railway and airport infrastructure to further enhance the

city’s transportation systems , the metropolitan area, the regional and intra-regional

area;

✓ The redevelopment of large vacant city spaces near areas like Bovisa-Goccia, San

Siro-Trotto, Piazza d’Armi, Ronchetto, Porto di Mare;

✓ Plans to make the city “greener” by converting areas for agricultural use, and by

connecting and enlarging parks;

✓ Great importance is also being given to closing the gap between the centre and the

suburbs, by renovating areas without disrupting the distinctiveness of each

neighbourhood. Examples of target areas are Navigli and underground stations like

Loreto, Maciachini, Lotto, Romolo, Trento and Corvetto.

Lastly, the city is scheduled to host the 2026 Winter Olympics, also known as Milano

Cortina 2026. This will be the fourth Olympic Games held in Italy and the first featuring two

host cities (Milan and Cortina), thus its name. The event is not only expected to promote

Italian tourism, but to also strengthen transportation and connections between the two cities.

0

2,000

4,000

6,000

8,000

10,000

12,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018


Abitare In

Both the Milano 2030 project and the Milano Cortina 2026 Olympic Games are expected to

have a positive impact on the city’s property sector and its urban transformation, thus

making Milan a breeding ground of profitable opportunities in the real-estate market. We

also highlight that AbitareIn has already signed preliminary ad final agreements to buy plots

of land near the Olympic village, which is expected to have a positive effect on the area and

eventually on prices.

COVID-19 outbreak impact

The COVID-19 outbreak has caused a major disruption in economy and could lead to some

mid-long term changes in the consumers’ behavior and also on the real estate sector. As

regards AbitareIn and its sector we highlight the following impacts.

Slowdowns in construction sites – the Italian government has imposed some restrictions on

the construction activity in March and April. Furthermore. new rules were approved to

increase the safety in the construction sites and prevent the virus spread. The combined

effect of restrictions and stricter safety rules is expected to lead to a 3-4 months delay of the

“Maggiolina” project. We expect the other projects will be completed according to the original

schedule and the delays caused by COVID-19 will be fully recovered.

Tourism sector heavily affected – the COVID-19 outbreak is causing a major disruption on

air traffic and tourism flows. Tourism reduces the supply of houses for residents; the sharp

increase in “rented beds” recorded in Milan in the last few years was a positive driver for the

company and, in general, for homebuilders. The main concern is the disruption on air traffic

which we assume will be over by the end of 2020 (see Eurocontrol’s assumptions). As

regards tourism we assume a slow recovery to the “pre-COVID 19” levels in the next few

years.

“Suburban migration” not sustainable in the long term – though the COVID-19 outbreak

could slowdown the “urbanization” trend in the short term, we believe that the underlying

social and economic incentives that led to “urbanization” have a lot of inertia and will led to

a recovery in the mid-term. Transport systems, access to high-speed networks, proximity to

schools, offices and co-working spaces are expected to remain important drivers for

urbanization. Furthermore, pollution, one of the main disadvantages of living in a urban area,

is expected to be tackled by the European Green Deal. In this respect we highlight that the

European commission is committed to “support new sustainable mobility services that can

reduce congestion and pollution, especially in urban areas” (see the European green deal

– communication from the Commission to the European parliament).

Higher demand for new and better houses – the COVID-19 outbreak has accelerated the

development of smart-working. This development is expected to change the demand both

for workspaces and for the configuration of homes; consumers will seek higher space

standards, bigger and newer houses with terraces and balconies. We also expect an

increase in popularity of sustainable houses, more efficient from an energy consumption

standpoint. This will increase the demand for new houses that can meet higher

expectations; the company's products, fully tailor-made homes, definitely fit the market's

changes.

Cheap mortgage – the disruption in economic activity is expected to have a big impact on

the labor market. However, mortgage rates are decreasing and are expected to remain low

in the short-mid term. This trend could incentivize the purchase of a house over renting and

be positive for the demand of new houses.


Abitare In

Ongoing projects and pipeline

The table below shows the main features of the portion of the company’s pipeline that is going to be developed in the short-mid term. The projects “AbitareIn Maggiolina”, “Milano City Village” and “Trilogy” projects are already “sold” and the construction is ongoing.

AbitareIn

Maggiolina

Milano City Village

(Via Tacito)

Trilogy

(Via Somalia)

AbitareIn

Naviglio Grande

Via

Savona

Olimpia Garden

(Corvetto)

N° of apartments 160.0 210.0 130.0 75.0 165.0 161

Revenues (Mln €) 67.4 78.0 55.0 31.0 85.0 41.6

Area purchase (Mln €) 7.5 13.5 4.1 5.0 18.5 15.6

Client downpayments (Mln €) 20.0 21.1 14.2 8.6 25.5 12.5

Source: Banca Akros and company data


Abitare In

Main ongoing projects

AbitareIn Maggiolina -100% sold

The marketing of the “Maggiolina” complex began in 2016. The complex is located in northern

Milan and involves the construction of a 10-storey building with around 160 flats.

Maggiolina complex

Source: Google maps

The company said in mid-2017 that it expected around EUR 67.4m in sales with a gross

margin of around 24m and a project EBT of around 15m. The project is expected to be

completed in 2020. Because of the COVID-19 outbreak we have assumed higher costs, for

around EUR 2m, and a few months of delay.

Maggiolina 2017 and before 2018 2019 2020e Total

Sales 14.7 10.6 21.6 20.6 67.4

Inventory progress 14.7 25.2 46.8 67.4

Gross margin 4.8 3.4 7.0 6.7 22

EBT 2.8 2.0 4.2 4.0 13

Down payment 16.2

Cash to the parent 14.9



Abitare In

Milano City village – 100% sold

The construction of the “Milano City Village” complex began in 2018. The complex includes

two buildings, “City Plaza” and “City Garden”, and is located in via Tacito in the south-east of

Milan. The project includes 210 flats with sales expected of EUR 78.2m.

Milano City Village location

Source:Google Maps

The company said in May 2019 that it expected around EUR 78.2m in sales. The project is

expected to be completed in 2022.

Milano City Village - Tacito 2018 2019 2020e 2021e 2022e Total

Sales 22.8 6.7 24.3 14.6 9.7 78.2

Inventory progress

29.5 53.9 68.5 78.2

Gross margin 7.3 2.1 7.8 4.7 3.1 25.1

EBT 2.8 0.8 3.0 1.8 1.2 20.0

Down payment 15.9




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Milano Trilogy – 100% sold

The construction of the “Trilogy Towers” complex (via Somalia) began in 2019 and is expected

to be completed in 2022. The project includes 130 flats with sales expected of EUR 55m.

Milano Trilogy location

Source: Google maps

The company said at the end of 2019 that it expected around EUR 55m in sales. The project

is expected to be completed in 2022.

Milano Trilogy 2019 2020e 2021e 2022e Total

Sales 10.4 14.9 14.9 14.9 55.0

Inventory progress

25.3 40.1 55.0

Gross margin 4.7 6.8 6.8 6.8 25.0

EBT 4.0 5.7 5.7 5.7 21.0

Down payment 6.9 9.6




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Projects expected to start in the next few months

The company said at the end of November 2019 that it would start three new projects by the

end of H1 2020: “Naviglio Grande”, “Via Savona” and “Corvetto”.

Naviglio Grande – Palazzo Naviglio

The company started the sale process at the end of 2019.

“Palazzo Naviglio” location

Source: Source: Google maps

The project involves the construction of 76 flats with total sales expected of 31m. The

company said on June 10th that it had sold 90% of the flats for around EUR 28.1m with

advance payments for EUR 8.6m. The project is expected to be completed by the end of

2022.

Milano Naviglio Grande 2020e 2021e 2022e Total

Sales 6.2 12.4 12.4 31

Inventory progress 18.6 31.0

Gross margin 2.5 5.0 5.0 12.4

EBT 1.6 3.2 3.2 8.0

Down payment 9.3

Cash to the parent

16.8



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Via Savona project

The sale process is ongoing. The area will have around 20,000sqm.

Savona project location

Source: Google maps

The project involves the construction of 165 flats and is expected to be completed in 2022.

Milano Via Savona 2020e 2021e 2022e 2023e Total

Sales 12.8 24.1 24.1 24.1 85

Inventory progress 36.8 60.9 85.0

Gross margin 4.2 7.9 7.9 7.9 28

EBT 3.2 6.0 6.0 6.0 21

Down payment 25.5

Cash to the parent

28.4



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Corvetto/Olimpia Garden

This is a “unique” project, 161 flats, for the company since it does not consist of a “greenfield”

development. The complex was already finished and the company only made small changes

after an “opportunistic” purchase. The company said at the end of May that it had received

binding offers to purchase 79 flats.

Corvetto/Olimpia garden location

Source: Google maps

The delivery is expected in 2021, a much shorter period compared to the company’s “normal” projects.

Milano Corvetto 2020e 2021e Total

Sales 15.6 26.0 41.6

Inventory progress 15.6 41.6

Gross margin 0.0 15.2 15.2

EBT 0.0 11.0 11.0

Down payment 12.5

Cash to the parent

17.2



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Business plan and pipeline

The company is going to increase its revenues and profits significantly with 2021 revenues

expected to be more than 3x 2019.

Business plan targets

2018 2019 2020e 2021e

Revenues 49 42 100 140

EBT 3.7 9 15 42

Backlog 146 190 200 310

Down payments 39.6 55.8 57 85

Source: company data

The foregoing targets are supported by a large pipeline of projects. In particular, the pipeline

includes 15 projects for a total of 2,050 flats and 190,000 sqm.

Projects Units Square meters

Pipeline 15 2,050 190,000


The plots of land in the pipeline are located in some of the most “promising” areas of the city

(Navigli, Porta Romana district, Certosa-Portello, Lambrate).

Location of development projects

Source: company presentation

The foregoing pipeline is expected to generate EUR 800m cumulated revenues and EUR

200m cumulated EBIT in a five-year period. We particularly highlight that the average book

price of the areas in the pipeline is EUR 640 per square meter or around 15% of the expected

sale price.

Revenues (EURm) EBIT (EURm) Turnover Book price (EUR per sqm)

Pipeline 800 200 5 years 640



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Strong pipeline implies good visibility on targets

One of the company’s most important features is a large pipeline of projects. The company

has signed preliminary agreements to purchase plots of land, around 140,000sqm (excluding

the projects currently ongoing or completed), for around EUR 80m. It is worth noting that the

pipeline is mainly made up of “brownfield sites”, often with former industrial or commercial

facilities. These areas normally require some remediation works and thus are not “ready to

be developed”. However, these features allow the company to operate in a less crowded

market and obtain lower prices. The drawback is that the authorisation and development

process is longer and more uncertain. However, the company’s expertise in completing the

authorisation process and developing the area offsets the risks. Furthermore, a large pipeline,

including many sites, also contributes to reducing the risks of a single area’s development

going more slowly than expected. By postponing the “finalisation”, the company limits the cost

of debt and keeps its balance sheet “light”.

Location Company Date Status SQM Purchase

price

Via Tarvisio AbitareIn Maggiolina finalized sold 14,500 3.3

Via Tacito Milano City village 28/06/2018 finalized sold 20,000 13.5

Via Privata Somalia Milano Trilogy 22/02/2018 finalized sold 12,000 4.1

Total I 46,500 20.9

Naviglio Grande I Palazzo Naviglio srl 01/04/2019 preliminary sold 6,800 5

Naviglio Grande II (via Savona 105) Savona 105 s.r.l. 04/06/2019 preliminary on sale 19,500 18.5

Corvetto (Olimpia Garden) AbitareIn Development 7 27/06/2019 preliminary sold 12,700 15.6

Total II 39,000

Via Cadolini Milano Progetti 29/06/2018 finalized to be developed 37,000 15.15

Viale Umbria - Milano Sviluppi 28/03/2018 finalized to be developed 7,500 1.5

Porta Romana I My City 17/05/2019 finalized to be developed 6,000 4.12

Certosa AbitareIn development 5 04/06/2019 preliminary to be developed 6,000 2.62

Piazzale Accursio AbitareIn Development 6 27/06/2019 preliminary to be developed 15,000 11

NoLo AbitareIn Development 8 05/07/2019 preliminary to be developed 7,500 2.7

Naviglio Grande III AbitareIn Development 4 17/07/2019 preliminary to be developed 12,600 7.85

Lambrate 1 Not specified 27/09/2019 preliminary to be developed 5.3

Lambrate 2 Not specified 27/09/2019 preliminary to be developed 2.5

Naviglio Grande IV MICA 08/10/2019 preliminary to be developed 7,050 6.5

Porta Romana II AbitareIn Development 4 21/01/2020 preliminary to be developed 45,000 16.1

Total III 143,650 75.34


Via Cadolini – in June 2018 AbitareIn finalised the purchase of a real-estate complex of

around 37,000sqm for EUR 15.15m.

Viale Tacito – in March 2019 the company finalised the purchase of a mortgage backed loan

related to a real-estate complex of 7,500sqm. The price was EUR 1.5m.

Naviglio Grande – in April 2019 the company signed the preliminary agreement to purchase

a real-estate complex of around 6,800sqm for EUR 5m.

Porta Romana district – in May 2019 the company finalised the purchase of a real-estate

complex of 6,000sqm for EUR 4.12m

Naviglio Grande via Savona – in June 2019 it signed a preliminary agreement to purchase

a real-estate complex of 19,500sqm for EUR 18.5m.


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Zona Certosa – in June 2019 the company signed a preliminary agreement to buy a real-

estate complex of around 6,000sqm in “zona Certosa” for EUR 2.62m.

Piazzale Accursio – in June 2019 the company signed a preliminary agreement to buy a

real-estate complex (in “piazzale Accursio 20”) of around 15,000sqm for EUR 11m.

Corvetto – in June 2019 the company signed a preliminary agreement to buy a real-estate

complex of around EUR 12,700 sqm near “Piazza Corvetto”. The price was EUR 15.6m.

NoLO – In July 2019 the company signed a preliminary agreement to buy a real-estate

complex of 7,500sqm in the “NoLo” neighbourhood for EUR 2.7m.

Naviglio Grande – in July 2019 the company signed a preliminary agreement to purchase a

real-estate complex of around 8,400sqm, near “Naviglio Grande”. The price was EUR 7.85m.

Lambrate – in September 2019 the company signed two preliminary agreements to purchase

two real estate complexes near “Lambrate”. The purchase prices were EUR 5.3m and EUR

2.25m.

Naviglio Grande- in October 2019 the company signed a preliminary agreement to buy a

real estate complex of around 7,000sqm near “Naviglio Grande”. The price was EUR 6.5m.

Porta Romana – in January 2020 the company signed a preliminary agreement to purchase

a plot of land south of “Porta Romana”. The area with a 45,000sqm development potential

cost EUR 16.1m.

HOMIZY – co-living

The company is going to leverage on the skills built by developing new residential projects to

offer “co-living” spaces. In particular, the company is going to develop new buildings to offer

“all-inclusive” bedrooms for around 550-900 euros a month. The main feature of Homizy is

the development of buildings designed and built “from scratch” for a “co-living experience”;

this implies efficiency in the management and maintenance of the building and better services

for clients.

According to the company, the “typical” client is a “young professional” between 18 and 35

who wants to be “independent” or has left his home city. In other words, the “co-living”

experience is a sort of middle step before “buying a house”.

We believe this could be a big opportunity going forward since the demand for this kind of

solution is robust. There are two clear long-term drivers: the Milan population is expected to

grow steadily in the next few years and the number of new houses is not expected to keep

up with a growing population, mainly as a result of a long and complicated authorisation

process; no more than 3,500/4,000 new homes are expected to be built per year vs. an

average increase in the number of families of almost 4,000 per year (Milan comune central

scenari). We highlight that the increase in tourists and “non-permanent residents” living in

Milan (students and temporary residents) obviously puts additional pressure on the supply.

We highlight that Homizy’s shareholders approved a capital increase of up to EUR 12m at

the end of April 2020. The company, that before the capital increase had 430,000 shares

(owned by AbitareIn) is going to issue up to 150,000 news shares at a price of EUR 80 per

share by April 30th 2021. On May 8th Homizy issued 56,250 new shares at a price of EUR 80

per share raising EUR 4.5m. The company said that the capital increase would allow the

purchase of plots of land and the development and design activity.


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Valuation

In order to value the company, we valued each project currently under development or already

launched (with the pre-sale phase ongoing). We discounted the cash-flows to the parent once

the projects are completed.

2020e 2021e 2022e

Total

Maggiolina 14.9

Milano City Village - Tacito 22.6

Milano Trilogy 21.5

Milano Naviglio Grande

16.8

Milano Via Savona 28.4

Milano Corvetto 17.2

Total 14.9 17.2 60.9 28.4 121.5

Taxes -4.0 -4.7 -16.5 -7.7 -32.8

Cash flow to equity 10.9 12.6 44.5 20.7 88.7

Discount rate factor 0.96 0.89 0.82 0.75

Discounted cash flow 10.5 11.2 36.3 15.6 73.6

Per share 4.1 4.3 14.1 6.1 28.6

Source: Banca Akros

We also assumed, prudently, that the company would sell around 30,000 sqm a year, from

the current pipeline, from 2023 to 2025. In this respect, we highlight that the current pipeline

could “generate” around 140,000 sqm.

Finally we highlight that we discounted the cash flow to the “parent company” with a cost of

equity of 8.5%.

2023e 2024e 2025e

Number of sqare meters 30,000 30,000 30,000

Sale price per sqm 3,750 3,750 3,750

Area cost per sqm 600 600 600

Construction cost per sqm* 1,750 1,750 1,750

EBT per sqm 1,400 1,400 1,400

EBT (EUR m) 42 42 42 126.0

Taxes -11.3 -11.3 -11.3 -34.0

Cash flow to equity 30.7 30.7 30.7 92.0

Discount rate factor 0.75 0.69 0.64

Discounted cash flow 23.1 21.3 19.6 64.0

Per share 9.0 8.3 7.6 24.9

Source: Banca Akros

The chart below is a sensitivity analysis base on different construction costs and sale prices.

Construction cost /

sale price 3,000 3,250 3,500 3,750 4,000 4,250 4,500

1,250 49.1 53.5 57.9 62.4 66.8 71.3 75.7

1,500 44.6 49.1 53.5 57.9 62.4 66.8 71.3

1,750 40.2 44.6 49.1 53.5 57.9 62.4 66.8

2,000 35.7 40.2 44.6 49.1 53.5 57.9 62.4

2,250 31.3 35.7 40.2 44.6 49.1 53.5 57.9

Source: Banca Akros


Abitare In

Estimates

The chart below shows our main estimates. We highlight that the company’s numbers are the

sum of different and uncorrelated projects and that each project is “segregated” both in terms

of revenues and costs and in terms of financing.

2018 2019 2020e 2021e 2022e

Revenues 49.05 44.56 102.25 138.11 179.89

Added value 5.11 13.07 19.74 37.45 49.31

EBITDA 4.26 11.37 16.45 35.32 47.10

EBITDA margin 8.69% 25.51% 16.09% 25.57% 26.18%

D&A -0.18 -0.56 -0.63 -0.71 -0.71

EBIT 4.08 10.81 15.82 34.61 46.39

EBT 3.70 9.46 13.72 32.01 43.59

Taxes -1.11 -3.08 -4.46 -10.40 -14.17

Net profit 2.59 6.38 9.26 21.60 29.42

NWC 42.9 70.3 74.1 109.6 77.6

Net debt 8.8 32.0 26.9 41.1 -20.0


Abitare In

Abitare In: Summary tables


Abitare In

Abitare In: Summary tables

Sector: Financial Services Industrials/FinSvcs Industrials

Company Description: Abitare In is an innovative industrial company founded in 2015, operating in the property sector. It develops urban building projects in Milan by reviving abandoned factories or industrial complexes while offering highly customizable residential houses. Intervention areas are located within the semi-centre perimeter of the city, targeting the affordable segment of the market characterized by sale prices ranging from EUR 3,000 to EUR 5,000 per square metre.


Abitare In

European Coverage of the Members of ESN

Aerospace & Defense Mem(*) Tubacex GVC Marr BAK Industrial Transportation Mem(*)

Airbus Se CIC Chemicals Mem(*) Sonae CBI Bollore CIC

Avio BAK Air Liquide CIC General Industrials Mem(*) Clasquin IAC

Dassault Aviation CIC Arkema CIC Adl Bionatur Solutions GVC Ctt CBI

Figeac Aero CIC Plasticos Compuestos GVC Cembre BAK Insurance Mem(*)

Latecoere CIC Electronic & Electrical Eq. Mem(*) Sergeferrari Group CIC Axa CIC

Leonardo BAK Rexel CIC General Retailers Mem(*) Catalana Occidente GVC

Lisi CIC Fin. Serv. Holdings Mem(*) Emova Group IAC Cattolica Assicurazioni BAK

Safran CIC Cir BAK Fnac Darty CIC Generali BAK

Thales CIC Corp. Financiera Alba GVC Inditex GVC Mapfre GVC

Alternative Energy Mem(*) Digital Magics BAK Maisons Du Monde CIC Net Insurance BAK

Encavis Ag CIC Eurazeo CIC Ovs BAK Unipolsai BAK

Plc BAK Ffp CIC Unieuro BAK Materials, Construction Mem(*)

Siemens Gamesa Re GVC Rallye CIC Healthcare Mem(*) Acs GVC

Voltalia CIC Tip Tamburi Investment Partners BAK Abionyx Pharma CIC Aena GVC

Automobiles & Parts Mem(*) Wendel CIC Amplifon BAK Astaldi BAK

Brembo BAK Fin. Serv. Industrials Mem(*) Atrys Health GVC Astm BAK

Faurecia CIC Bolsas Y Mercados Espanoles GVC Crossject CIC Atlantia BAK

Ferrari BAK Dovalue BAK Diasorin BAK Buzzi Unicem BAK

Fiat Chrysler Automobiles BAK Nexi BAK El.En. BAK Capelli CIC

Gestamp GVC Tinexta BAK Fermentalg CIC Cementir BAK

Indelb BAK Financial Services Banks Mem(*) Fine Foods BAK Clerhp Estructuras GVC

Landi Renzo BAK Amundi CIC Genfit CIC Eiffage CIC

Piaggio BAK Anima BAK Guerbet CIC Ezentis GVC

Plastic Omnium CIC Azimut BAK Korian CIC Fcc GVC

Sogefi BAK Banca Farmafactoring BAK Oncodesign CIC Ferrovial GVC

Banks Mem(*) Banca Generali BAK Orpea CIC Groupe Adp CIC

Banca Mps BAK Banca Ifis BAK Recordati BAK Groupe Poujoulat CIC

Banco Sabadell GVC Banca Mediolanum BAK Shedir Pharma BAK Groupe Sfpi S.A. CIC

Banco Santander GVC Banca Sistema BAK Theraclion CIC Herige CIC

Bankia GVC Finecobank BAK Household Goods Mem(*) Hexaom CIC

Bankinter GVC Poste Italiane BAK Abeo CIC Imerys CIC

Bbva GVC Food & Beverage Mem(*) De Longhi BAK Kaufman & Broad IAC

Bcp CBI Advini CIC Fila BAK Lafargeholcim CIC

Bnp Paribas CIC Bonduelle CIC Groupe Seb CIC Maire Tecnimont BAK

Bper BAK Campari BAK Industrial Engineering Mem(*) Mota Engil CBI

Caixabank GVC Danone CIC Alstom CIC Obrascon Huarte Lain GVC

Credem BAK Ebro Foods GVC Biesse BAK Sacyr GVC

Credit Agricole Sa CIC Enervit BAK Caf GVC Saint Gobain CIC

Creval BAK Fleury Michon CIC Carraro BAK Salcef BAK

Intesa Sanpaolo BAK Italian Wine Brands BAK Cnh Industrial BAK Sonae Industria CBI

Liberbank GVC Lanson-Bcc CIC Danieli BAK Tarkett CIC

Mediobanca BAK Laurent Perrier CIC Datalogic BAK Thermador Groupe CIC

Natixis CIC Ldc CIC Exel Industries CIC Vicat CIC

Rothschild & Co CIC Orsero BAK Fincantieri BAK Vinci CIC

Societe Generale CIC Pernod Ricard CIC Groupe Gorge CIC Webuild BAK

Ubi Banca BAK Remy Cointreau CIC Haulotte Group CIC Media Mem(*)

Unicredit BAK Tipiak CIC Ima BAK Arnoldo Mondadori Editore BAK

Basic Resources Mem(*) Vidrala GVC Interpump BAK Atresmedia GVC

Acerinox GVC Vilmorin CIC Manitou CIC Cairo Communication BAK

Altri CBI Viscofan GVC Prima Industrie BAK Cofina CBI

Arcelormittal GVC Vranken Pommery Monopole CIC Prysmian BAK Digital Bros BAK

Corticeira Amorim CBI Food & Drug Retailers Mem(*) Talgo GVC Gedi Gruppo Editoriale BAK

Ence GVC Carrefour CIC Zardoya Otis GVC Gl Events CIC

Semapa CBI Casino Guichard-Perrachon CIC Il Sole 24 Ore BAK

The Navigator Company CBI Jeronimo Martins CBI Impresa CBI


Abitare In

Ipsos CIC Quabit Immobiliaria GVC Orange CIC

Jcdecaux CIC Realia GVC Telecom Italia BAK

Lagardere CIC Software & Computer Ser. Mem(*) Telefonica GVC

M6-Metropole Television CIC Agile Content GVC Tiscali BAK

Mediaset BAK Akka Technologies CIC Vodafone BAK

Mediaset Espana GVC Alten CIC Travel & Leisure Mem(*)

Nrj Group CIC Altran CIC Accor CIC

Publicis CIC Amadeus GVC Autogrill BAK

Rcs Mediagroup BAK Assystem CIC Beneteau CIC

Solocal Group CIC Atos CIC Codere GVC

Teleperformance CIC Axway Software CIC Compagnie Des Alpes CIC

Tf1 CIC Capgemini CIC Edreams Odigeo GVC

Ubisoft CIC Cast CIC Elior CIC

Vivendi CIC Catenon GVC Europcar CIC

Vogo CIC Econocom CIC Fdj CIC

Oil & Gas Producers Mem(*) Ekinops CIC Groupe Partouche IAC

Ecoslops CIC Esi Group CIC I Grandi Viaggi BAK

Enauta CBI Exprivia BAK Ibersol CBI

Eni BAK Gigas Hosting GVC Int. Airlines Group GVC

Galp Energia CBI Gpi BAK Melia Hotels International GVC

Gas Plus BAK Groupe Open CIC Nh Hotel Group GVC

Maurel Et Prom CIC Indra Sistemas GVC Pierre Et Vacances CIC

Repsol GVC Lleida.Net GVC Sodexo CIC

Total CIC Neurones CIC Sonae Capital CBI

Oil Services Mem(*) Reply BAK Trigano CIC

Bourbon CIC Sii CIC Utilities Mem(*)

Cgg CIC Sopra Steria Group CIC A2A BAK

Gtt CIC Visiativ CIC Acciona GVC

Rubis CIC Worldline CIC Acea BAK

Saipem BAK Support Services Mem(*) Albioma CIC

Technipfmc Plc CIC Bureau Veritas CIC Audax GVC

Tecnicas Reunidas GVC Cellnex Telecom GVC Derichebourg CIC

Tenaris BAK Edenred CIC Edp CBI

Vallourec CIC Enav BAK Edp Renováveis CBI

Personal Goods Mem(*) Fiera Milano BAK Enagas GVC

Basicnet BAK Inwit BAK Endesa GVC

Brunello Cucinelli BAK Openjobmetis BAK Enel BAK

Cellularline BAK Prosegur GVC Erg BAK

Cie Fin. Richemont CIC Prosegur Cash GVC Falck Renewables BAK

Geox BAK Rai Way BAK Greenalia GVC

Hermes Intl. CIC Technology Hardware & Eq. Mem(*) Hera BAK

Interparfums CIC Adeunis CIC Holaluz GVC

Kering CIC Evolis CIC Iberdrola GVC

L'Oreal CIC Hf Company CIC Iren BAK

Lvmh CIC Ingenico CIC Italgas BAK

Moncler BAK Memscap IAC Naturgy GVC

Safilo BAK Osmozis CIC Red Electrica Corporacion GVC

Salvatore Ferragamo BAK Stmicroelectronics BAK Ren CBI

Smcp CIC Tier 1 Technology GVC Snam BAK

Swatch Group CIC Telecommunications Mem(*) Solaria GVC

Technogym BAK Altice Europe CIC Terna BAK

Tod'S BAK Bouygues CIC

Real Estate Mem(*) Euskaltel GVC

Igd BAK Iliad CIC

Lar España GVC Masmovil GVC

Merlin Properties GVC Nos CBI

LEGEND: BAK: Banca Akros; CIC: CIC Market Solutions; CBI: Caixa-Banco de Investimento; GVC: GVC Gaesco Valores, SV, SA as 25th May 2020


Abitare In

List of ESN Analysts (**)

Artur Amaro CBI +351 213 89 6822 [email protected]

Helena Barbosa CBI +351 21 389 6831 [email protected]

Agnès Blazy CIC +33 1 53 48 80 67 [email protected]

Andrea Bonfà BAK +39 02 4344 4269 [email protected]

Jean-Baptiste Bouchet CIC +33 1 53 48 80 69 [email protected]

Giada Cabrino, CIIA BAK +39 02 4344 4092 [email protected]

Nuno Castro CBI +351 21 389 68 39 [email protected]

Pierre Chédeville CIC +33 1 53 48 80 97 [email protected]

Emmanuel Chevalier CIC +33 1 53 48 80 72 [email protected]

David Da Maia CIC +33 1 53 48 89 36 [email protected]

Dominique Descours CIC +33 1 53 48 81 12 [email protected]

Christian Devismes CIC +33 1 53 48 80 85 [email protected]

Andrea Devita, CFA BAK +39 02 4344 4031 [email protected]

Enrico Esposti, CIIA BAK +39 02 4344 4022 [email protected]

Rafael Fernández de Heredia GVC +34 91 436 78 08 [email protected]

Gabriele Gambarova BAK +39 02 43 444 289 [email protected]

Pietro Gasparri, CIIA, CEFA BAK +39 02 4344 4238 [email protected]

Alexandre Gérard CIC +33 1 53 48 80 93 [email protected]

Ebrahim Homani CIC +33 1 53 48 80 94 [email protected]

Carlos Jesus CBI +351 21 389 6812 [email protected]

Jean-Christophe Lefèvre-Moulenq CIC +33 1 53 48 80 65 [email protected]

Charles Henry Mata CIC +33 1 53 48 80 64 [email protected]

Marisa Mazo, Ph.D, CFA GVC +34 91 436 7817 [email protected]

Fanny Meindre, PhD CIC +33 1 53 48 80 84 [email protected]

Emanuele Oggioni BAK +39 0243 444 237 [email protected]

Jaime Pallares Garcia GVC +34 91 436 7818 [email protected]

Victor Peiro Pérez GVC +34 91 436 7812 [email protected]

Juan Peña GVC +34 91 436 78 16 [email protected]

Alexandre Plaud CIC +33 1 53 48 80 90 [email protected]

Francis Prêtre CIC +33 4 78 92 02 30 [email protected]

Eric Ravary CIC +33 1 53 48 80 71 [email protected]

Iñigo Recio Pascual GVC +34 91 436 7814 [email protected]

Beatriz Rodriguez Fernandez GVC +34 914 367 871 [email protected]

Jean-Luc Romain CIC +33 1 53 48 80 66 [email protected]

Paola Saglietti BAK +39 02 4344 4287 [email protected]

Francesco Sala BAK +39 02 4344 4240 [email protected]

Luigi Tramontana BAK +39 02 4344 4239 [email protected]

(**) excluding: strategists, macroeconomists, heads of research not covering specific stocks, credit analysts, technical analysts


Abitare In

Il presente documento è stato redatto da Francesco Sala (socio AIAF) e Gian Marco Gadini che svolgono funzioni di analista presso Banca Akros SpA ("Banca Akros"), soggetto responsabile della produzione del documento stesso. Esso è prodotto e distribuito dal giorno 21 luglio 2020, ore 08:57 italiane. Gli analisti di Banca Akros, che hanno redatto il presente documento, hanno maturato una significativa esperienza presso Banca Akros e altri intermediari.

Detti analisti e i loro familiari non detengono Strumenti Finanziari emessi dagli Emittenti oggetto di analisi, né svolgono ruoli di amministrazione, direzione o consulenza per gli Emittenti, né gli analisti ricevono bonus, stipendi o altre forme di retribuzione correlate, direttamente o indirettamente, al successo di operazioni di investment banking.

Banca Akros, nell’ultimo anno, non ha pubblicato studi sulla società oggetto di analisi in quanto trattasi di inizio copertura.

Ai sensi degli artt. 5 e 6 del Regolamento Delegato 2016/958, Banca Akros ha specifici interessi nei confronti della società oggetto di analisi nel presente documento, in quanto la Banca è Corporate Broker. Banca Akros è una banca autorizzata anche alla prestazione di servizi di investimento appartenente al Gruppo Banco BPM (il “Gruppo”), ed è soggetta all’attività di direzione e coordinamento di Banco BPM (la “Capogruppo”). La banca è iscritta all’albo delle Banche al n. 5328 ed è soggetta alla regolamentazione e alla vigilanza di Banca d’Italia e Consob.

La banca ha prodotto il presente documento solo ed esclusivamente per i propri clienti professionali ai sensi della Direttiva 2014/65/EU, del Regolamento Delegato 2016/958 e dell’Allegato 3 del Regolamento Intermediari Consob (Delibera Consob n. 20307). Banca Akros rende disponibili informazioni sui conflitti di interesse, ai sensi delle disposizioni contenute nell’art. 20 del Regolamento EU 2014/596 (Regolamento sugli Abusi di Mercato) e in particolare ai sensi degli artt. 5 e 6 del Regolamento Delegato EU 2016/958, sul proprio sito internet:

http://www.bancaakros.it/menu-informativa/analisi-finanziaria-e-market-abuse.aspx Le informazioni e le opinioni contenute in questo documento si basano su fonti ritenute attendibili. La provenienza di dette informazioni e il fatto che si tratti di informazioni già rese note al pubblico è stata oggetto di ogni ragionevole verifica da parte di Banca Akros. Banca Akros tuttavia, nonostante le suddette verifiche, non può garantire in alcun modo né potrà in nessun caso essere ritenuta responsabile qualora le informazioni alla stessa fornite, riprodotte nel presente documento, ovvero sulla base delle quali è stato redatto il presente documento, si rivelino non accurate, complete, veritiere ovvero non corrette. Il documento è fornito a solo scopo informativo; esso non costituisce proposta contrattuale, offerta o sollecitazione all’acquisto e/o alla vendita di strumenti finanziari o, in genere, all’investimento, né costituisce consulenza in materia di investimenti. Banca Akros non fornisce alcuna garanzia di raggiungimento di qualunque previsione e/o stima contenuto nel documento stesso. Inoltre Banca Akros non assume alcuna responsabilità in merito a qualsivoglia conseguenza e/o danno derivante dall’utilizzo del presente documento e/o delle informazioni in esso contenute. Le informazioni o le opinioni ivi contenute possono variare senza alcun conseguente obbligo di comunicazione in capo a Banca Akros, fermi restando eventuali obblighi di legge o regolamentari. E’ vietata la riproduzione e/o la ridistribuzione, in tutto o in parte, direttamente o indirettamente, del presente documento, se non espressamente autorizzata da Banca Akros. In ogni caso è espressamente vietata la trasmissione con qualsiasi mezzo del presente documento o del suo contenuto, anche solo in parte, a soggetti che non siano classificati come clienti professionali o controparti qualificate ai sensi della Direttiva UE 2014/65.


http://www.bancaakros.it/menu-informativa/analisi-finanziaria-e-market-abuse.aspx

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ESN Recommendation System

The ESN Recommendation System is Absolute. It means that each stock is rated based on total

return, measured by the upside/downside potential (including dividends and capital reimbursement)

over a 12-month time horizon. The final responsible of the recommendation of a listed company is the

analyst who covers that company. The recommendation and the target price set by an analyst on one

stock are correlated but not totally, because an analyst may include in its recommendation also

qualitative elements as market volatility, earning momentum, short term news flow, possible M&A

scenarios and other subjective elements.

The ESN spectrum of recommendations (or ratings) for each stock comprises 5 categories:

Buy (B), Accumulate (A), Neutral (N), Reduce (R) and Sell (S).

Furthermore, in specific cases and for a limited period of time, the analysts are allowed to rate the stocks

as Rating Suspended (RS) or Not Rated (NR), as explained below.

Meaning of each recommendation or rating:

• Buy: the stock is expected to generate total return of over 15% during the next 12-month

• Accumulate: the stock is expected to generate total return of 5% to 15% during the next 12-month

• Neutral: the stock is expected to generate total return of -5% to +5% during the next 12-month

• Reduce: the stock is expected to generate total return of -5% to -15% during the next 12-month

• Sell: the stock is expected to generate total return under -15% during the next 12-month

• Rating Suspended: the rating is suspended due to: a) a capital operation (take-over bid, SPO, etc.) where a Member of ESN is or could be involved with the issuer or a related party of the issuer; b) a change of analyst covering the stock; c) the rating of a stock is under review by the Analyst.

• Not Rated: there is no rating for a stock when there is a termination of coverage of the stocks or a company being floated (IPO) by a Member of ESN or a related party of the Member.

Note: a certain flexibility on the limits of total return bands is permitted especially during higher phases of volatility on the markets

Banca Akros Ratings Breakdown

For full ESN Recommendation and Target price history (in the last 12 months) please see ESN Website Link

Date and time of production: 21 July 2020: 8:38 CET First date and time of dissemination: 21 July 2020: 8:43 CET


http://www.esnpartnership.eu/research_and_database_access

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Disclaimer: These reports have been prepared and issued by the Members of European Securities Network LLP (‘ESN’). ESN, its Members and their affiliates (and any director, officer or employee thereof), are neither liable for the proper and complete transmission of these reports nor for any delay in their receipt. Any unauthorised use, disclosure, copying, distribution, or taking of any action in reliance on these reports is strictly prohibited. The views and expressions in the reports are expressions of opinion and are given in good faith, but are subject to change without notice. These reports may not be reproduced in whole or in part or passed to third parties without permission. The information herein was obtained from various sources. ESN, its Members and their affiliates (and any director, officer or employee thereof) do not guarantee their accuracy or completeness, and neither ESN, nor its Members, nor its Members’ affiliates (nor any director, officer or employee thereof) shall be liable in respect of any errors or omissions or for any losses or consequential losses arising from such errors or omissions. Neither the information contained in these reports nor any opinion expressed constitutes an offer, or an invitation to make an offer, to buy or sell any securities or any options, futures or other derivatives related to such securities (‘related investments’). These reports are prepared for the professional clients of the Members of ESN only. They do not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive any of these reports. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed or recommended in these reports and should understand that statements regarding future prospects may not be realised. Investors should note that income from such securities, if any, may fluctuate and that each security’s price or value may rise or fall. Accordingly, investors may receive back less than originally invested. Past performance is not necessarily a guide to future performance. Foreign currency rates of exchange may adversely affect the value, price or income of any security or related investment mentioned in these reports. In addition, investors in securities such as ADRs, whose value are influenced by the currency of the underlying security, effectively assume currency risk. ESN, its Members and their affiliates may submit a pre-publication draft (without mentioning neither the recommendation nor the target price/fair value) of its reports for review to the Investor Relations Department of the issuer forming the subject of the report, solely for the purpose of correcting any inadvertent material inaccuracies. Like all members employees, analysts receive compensation that is impacted by overall firm profitability For further details about the analyst certification, the specific risks of the company and about the valuation wmethods used to determine the price targets included in this report/note, please refer to the specific disclaimer pages prepared by the ESN Members. In the case of a short note please refer to the latest relevant published research on single stock or contact the analyst named on the front of the report/note for detailed information on the valuation methods, earning estimates and risks. A full description of all the organisational and administrative measures taken by the Members of ESN to manage interest and conflicts of interest are available on the website of the Members or in the local disclaimer of the Members or contacting directly the Members. Research is available through the ESN Members sales representative. ESN and/or ESN Members will provide periodic updates on companies or sectors based on company-specific developments or announcements, market conditions or any other publicly available information. Unless agreed in writing with an ESN Member, this research is intended solely for internal use by the recipient. Neither this document nor any copy of it may be taken or transmitted into Australia, Canada or Japan or distributed, directly or indirectly, in Australia, Canada or Japan or to any resident thereof. This document is for distribution in the U.K. only to persons who have professional experience in matters relating to investments and fall within article 19(5) of the financial services and markets act 2000 (financial promotion) order 2005 (the “order”) or (ii) are persons falling within article 49(2)(a) to (d) of the order, namely high net worth companies, unincorporated associations etc (all such persons together being referred to as “relevant persons”). This document must not be acted on or relied upon by persons who are not relevant persons. Any investment or investment activity to which this document relates is available only to relevant persons and will be engaged in only with relevant persons. The distribution of this document in other jurisdictions or to residents of other jurisdictions may also be restricted by law, and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. By accepting this report, you agree to be bound by the foregoing instructions. You shall indemnify ESN, its Members and their affiliates (and any director, officer or employee thereof) against any damages, claims, losses, and detriments resulting from or in connection with the unauthorized use of this document. For disclosure upon “conflicts of interest” on the companies under coverage by all the ESN Members, on the “interests” and “conflicts” of the analysts and on each “company recommendation history”, please visit the ESN website: http://www.esnpartnership.eu/research_and_database_access or refer to the local disclaimer of the Members, or contact directly the Members:

www.bancaakros.it regulated by the CONSOB - Commissione Nazionale per le Società e la Borsa

www.caixabi.pt regulated by the CMVM - Comissão do Mercado de Valores Mobiliários

www.cic-marketsolutions.eu regulated by the AMF - Autorité des marchés financiers

www.valores.gvcgaesco.es regulated by CNMV - Comisión Nacional del Mercado de Valores

Members of ESN (European Securities Network LLP)


http://www.esnpartnership.eu/research_and_database_access

http://www.bancaakros.it/

http://www.caixabi.pt/

http://www.cic-marketsolutions.eu/

http://www.valores.gvcgaesco.es/

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