Last close As at 05/08/2026
EUR21.35
▲ 0.05 (0.23%)
Market capitalisation
EUR376m
Research: Investment Companies
Deutsche Deutsche Beteiligungs (DBAG) is a well-established player in the German private equity (PE) mid-market. It has been increasing its exposure to new ‘growth’ sectors, which currently make up 43% of its portfolio and have proved resilient in the COVID-19 crisis. These include broadband/telecom (25%), which are a play on the secular trend of network roll-out in Germany. DBAG’s industrial exposure (currently valued at slightly below the average acquisition cost) represents 39% of the portfolio and may appeal to investors seeking exposure to cyclical value companies.(DBAG) is a well-established player in the German private equity (PE) mid-market. It has been increasing its exposure to new âgrowthâ sectors, which currently make up 43% of its portfolio and have proved resilient in the COVID-19 crisis. These include broadband/telecom (25%), which are a play on the secular trend of network roll-out in Germany. DBAGâs industrial exposure (currently valued at slightly below the average acquisition cost) represents 39% of the portfolio and may appeal to investors seeking exposure to cyclical value companies.
Deutsche Beteiligungs |
German private equity investor and manager
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Private equity |
Deutsches Eigenkapitalforum 2021
27 October 2021 |
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Deutsche Beteiligungs is a research client of Edison Investment Research Limited |
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Deutsche Beteiligungs (DBAG) is a well-established player in the German private equity (PE) mid-market. It has been increasing its exposure to new ‘growth’ sectors, which currently make up 43% of its portfolio and have proved resilient in the COVID-19 crisis. These include broadband/telecom (25%), which are a play on the secular trend of network roll-out in Germany. DBAG’s industrial exposure (currently valued at slightly below the average acquisition cost) represents 39% of the portfolio and may appeal to investors seeking exposure to cyclical value companies.
Multiple positive guidance revisions
DBAG posted a 24.5% NAV total return in 9M21 ending June, even after the dilutive impact of the c €106m recent share issue. On the back of strong portfolio revaluations, DBAG posted a net profit of €131m in 9M21 (9M20: €25m loss), which was supported by successful disposals (DNS:Net, Rheinhold & Mahla and blikk). DBAG raised its FY21 guidance three times during the year and currently expects net income of €175–195m (from an initial €40–45m). It now also expects profit from fund services of €19–20m (from €15–16m) due to lower than anticipated divisional costs. This implies a c 100% y-o-y increase in fund services income in FY21 and reflects fees from the DBAG Fund VIII launched in August 2020.
DBAG plans to accelerate investments
DBAG has recently taken steps aimed at a significant increase in its investment activity, including: 1) team expansion (80 employees versus 75 at end FY19 and this is expected to increase further), 2) increasing its credit facility to €106.7m (of which €46.2m remains undrawn), and 3) a successful equity issue with gross proceeds of €106m. DBAG intends to invest c €120m pa, 40% more than its historical three-year average. We calculate that paired with the disposal proceeds from recent exits, DBAG had c €205m available for investments at end June 2021.
Valuation: Two business units
DBAG trades at a 14.0% premium to its NAV (defined as equity value), below its five-year average of 18.6%, despite the solid performance. The persisting premium in our view comes from the value of the fund services segment, which is not captured in the NAV. If we assume that DBAG’s PE investments segment is valued at a discount to NAV in line with its peers (currently 9%), the market-implied value of the fund services segment is €145m, which translates to a c 7.5x FY21 P/E multiple. This implies a c 70% discount to listed alternative asset managers and suggests that DBAG’s current market valuation may be relatively undemanding.
Source: Refinitiv. Note: 12-month total return performance in euros up to last reported NAV. |
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Research: TMT
In its Q321 trading update, CI Games confirmed strong Q321 revenues of c PLN30.2m and PAT of c PLN9.8m, a 32.5% net margin. Q4 is CI Games’ seasonally strongest quarter, so we anticipate Q421 trading to be similar to Q321. We have therefore raised our FY21 estimates, with FY21 revenues rising 12% to PLN105.0m, and a 32.5% margin giving reported PAT of PLN34.1m. CI Games also announced a new survival game for the PC and latest console generations on Unreal Engine 5 by Czech games developer, BatFields. The IP is to be owned by CI Games. We see this as a positive and necessary step as CI Games invests in broadening its games portfolio, forming the group’s third franchise if the title is successful. As outlined in our recent initiation, An emerging European game publisher, timely delivery of high-quality titles is critical to the investment case.