Media and Games Invest — Strong momentum carrying into FY21

Verve Group (OMX: VER)

Last close As at 10/10/2024

EUR3.23

0.03 (0.78%)

Market capitalisation

EUR598m

More on this equity

Research: TMT

Media and Games Invest — Strong momentum carrying into FY21

Media and Games Invest (MGI) reported FY20 revenues of €140.2m and adjusted EBITDA of €29.1m, ending the year strongly to deliver 67% y o y revenue growth. In H220, MGI completed a dual listing and share placing (for €29m) on Nasdaq First North Premier and issued an €80m bond. MGI has carried its momentum into FY21, with the transformational acquisition of KingsIsle Entertainment (Wizard101, Pirate101) for US$126m in cash upfront, up to US$210m including earn-out. The acquisition was funded by the placings, together with a further placing of c 9% of MGI’s shares to Oaktree Capital, an anchor investor for MGI. MGI had net interest-bearing debt of €91.6m (post KingsIsle), with net leverage of 2.0x pro forma FY20 adjusted EBITDA (€46.0m).

Analyst avatar placeholder

Written by

TMT

Media and Games Invest

Strong momentum carrying into FY21

Software & computer services

Scale research report - Update

11 March 2021

Price

€3.54

Market cap

€456m

Share price graph

Share details

Code

M8G

Listing

Deutsche Börse Scale /
Nasdaq First North Premier

Shares in issue

128.8m

Estimated net debt as at 18/2/21

€91.6m

Business description

Media and Games Invest is a fast-growing and profitable digital games company with a strong, supportive media unit. The company combines organic growth with value-accretive acquisitions to deliver strong and sustainable earnings growth.

Bull

Experienced management team with a proven buy-and-build M&A track record.

Capitalising on surge in gaming demand and long-term growth trends.

45% revenue CAGR FY14–20.

Bear

After a period of rapid transformation, the group structure is only just starting to settle.

Debt levels remain elevated, towards the top of management’s 2–3x EV/EBITDA guidance.

MGI’s portfolio is PC focused, with mobile still substantially under-represented.

Analysts

Richard Williamson

+44 (0) 20 3077 5700

Dan Ridsdale

+44 (0) 20 3077 5700

Media and Games Invest (MGI) reported FY20 revenues of €140.2m and adjusted EBITDA of €29.1m, ending the year strongly to deliver 67% yoy revenue growth. In H220, MGI completed a dual listing and share placing (for €29m) on Nasdaq First North Premier and issued an €80m bond. MGI has carried its momentum into FY21, with the transformational acquisition of KingsIsle Entertainment (Wizard101, Pirate101) for US$126m in cash upfront, up to US$210m including earn-out. The acquisition was funded by the placings, together with a further placing of c 9% of MGI’s shares to Oaktree Capital, an anchor investor for MGI. MGI had net interest-bearing debt of €91.6m (post KingsIsle), with net leverage of 2.0x pro forma FY20 adjusted EBITDA (€46.0m).

FY20 results: Six-year revenue CAGR of 45% to FY20

MGI reported FY20 revenues of €140.2m, up 67% y-o-y (FY19: €83.9m) and adjusted EBITDA of €29.1m, an increase of 61% y-o-y (€18.1m). FY20 adjusted EBITDA margins were 21%, a slight reduction from 22% in FY19. MGI’s strong performance resulted in the group reporting a net profit of €2.7m, a rise of 116% yoy (FY19: €1.3m). The group had cash and cash equivalents as at 31 December 2020 of €46.3m (FY19: €33.0m), with net interest-bearing debt of €61.6m (FY19: €34.9m). The games division was the main driver of MGI’s performance, although the media division also reported strong growth and improving margins. MGI has delivered a six-year revenue CAGR of 45% to FY20.

KingsIsle, a transformative M&A deal

Post-year end, in February 2021, MGI announced the acquisition of US-based KingsIsle (online PC games Pirate101, Wizard101) for total cash consideration of up to US$210m. FY21 guidance for KingsIsle is for revenues of US$32m and adjusted EBITDA of US$21m (66% adjusted EBITDA margin). This is a major, transformative acquisition for MGI, struck at an attractive price (5.8–7.3x FY21 adjusted EBITDA), with potential upside from taking KingsIsle’s IP to mobile and console from FY22.

Valuation: Attractive growth fundamentals

Management’s focus in FY21 is likely to be to consolidate its recent acquisitions ahead of further M&A. With numerous organic growth projects in the pipeline, MGI’s valuation is supported by continuing attractive underlying growth, with net leverage set to fall to the lower end of management’s 2–3x target range within 12–18 months.

Consensus estimates

Year
end

Revenue
(€m)

Adj. EBITDA*
(€m)

PBT
(€)

EPS
(€)

EV/adjusted EBITDA*
(x)

P/E
(x)

12/19

83.9

18.1

(0.8)

(0.01)

30.2

N/A

12/20

140.2

29.1

3.9

0.12

18.8

30.1

12/21e

171.4

48.6

18.6

0.12

11.3

30.1

12/22e

195.8

50.2

24.8

0.15

10.9

23.2

Source: MGI accounts (historical figures), Refinitiv consensus (forecasts). Note: *EBITDA adjusted for one-off M&A and financing costs.

Edison Investment Research provides qualitative research coverage on companies in the Deutsche Börse Scale segment in accordance with section 36 subsection 3 of the General Terms and Conditions of Deutsche Börse AG for the Regulated Unofficial Market (Freiverkehr) on Frankfurter Wertpapierbörse (as of 1 March 2017). Two to three research reports will be produced per year. Research reports do not contain Edison analyst financial forecasts.

FY20 results: Record year, more to come in FY21

MGI is a fast-growing and profitable games and digital media business. In its maiden full-year results following its Deutsche Börse Scale listing in July 2020, MGI reported FY20 revenues of €140.2m, up 67% y-o-y (FY19: €83.9m) and adjusted EBITDA of €29.1m, an increase of 61% y-o-y (FY19: €18.1m). FY20 adjusted EBITDA margins were 21%, a slight reduction from 22% in FY19. MGI’s strong performance resulted in the group reporting a net profit of €2.7m, a rise of 116% y-o-y (FY19: €1.3m). The group had cash and cash equivalents as at 31 December 2020 of €46.3m (FY19: €33.0m), with net interest-bearing debt of €61.6m (FY19: €34.9m).

Exhibit 1: FY20 financial results

€000

FY19

H120

H220

FY20

Revenue

83,893

56,569

83,651

140,220

Capitalised development

10,187

7,993

8,001

15,994

EBITDA

15,543

11,629

14,920

26,549

Adjusted EBITDA

18,135

13

29,122

29,135

Depreciation & Amortisation

(10,543)

(6,583)

(8,925)

(15,508)

EBIT

5,000

5,046

5,995

11,041

Net profit/(loss)

1,253

474

2,233

2,707

Owners of the Company

(324)

848

2,211

3,059

Non-controlling interests

1,577

374

(726)

(352)

Number of shares outstanding (m)

70.02

70.02

117.07

117.07

Average shares in issue (m)

60.39

65.21

93.55

85.50

EPS (adjusted) (€)

(0.01)

0.01

0.03

0.04

Net cash/(debt)

(34,911)

(70,709)

(61,600)

(61,600)

Source: MGI

MGI and the games sector as a whole have benefited from the COVID-19 pandemic lockdown, driven by sustained levels of high demand for games over the course of 2020 and into 2021. Not surprisingly, the games division was the principal factor behind MGI’s strong performance (54% of FY20 revenues, 79% of FY20 EBITDA), although the media division (46% of FY20 revenues, 21% of FY20 EBITDA) also reported strong growth and improving margins.

With its ‘Buy, Integrate, Build and Improve’ acquisition strategy supplementing organic growth, MGI has now delivered a six-year revenue CAGR of 45% to FY20.

Group operating cash flow was €25.2m in FY20 (FY19: €16.2m), an increase of 56%, highlighting the strong cash generation of the business. Interest cover on MGI’s debt for FY20 was 4.1x (FY19: 3.1x). Leverage increased marginally to 2.1x as at 31 December 2020 based on FY20 adjusted EBITDA (1.9x as at 31 December 2019) as MGI completed three M&A transactions in FY20, as well as the buyout of the gamigo minorities funded by both equity and bond placings.

Divisional breakdown

Games: Potential for sustained growth

Games represented 54% of group revenues but 79% of adjusted EBITDA in FY20, with adjusted EBITDA margins of 31% (FY19: 34%). MGI’s games segment includes over 10 massively multiplayer online games (MMOs) and over 5,000 casual games. Titles include ArcheAge Unchained, Aura Kingdom, Desert Operations, Grand Fantasia, Fiesta Online, Trove, Pirate101 and Wizard101 (acquired through the KingsIsle transaction). All share the same common characteristics, being established games, with loyal communities that can be grown through cost-effective user acquisition and supported and maintained through the launch of additional content.

MGI does not invest in developing new IP, seeing this as a high-risk exercise, but does develop new content for existing titles, as well as porting titles to new platforms (eg mobile, console).

Given the longevity of its titles and the stickiness of its player base, MGI expects the players it attracted through lockdown in FY20 and FY21 to deliver a long-term uplift to MGI’s player base and revenues as players become attached to games where they have invested in their character and the community. In a number of titles, more than half the player base has been playing the title for more than five years, leading to a highly sticky and predictable, recurring revenue stream.

Verve Group: A media platform ready for growth

Media represented 46% of group revenues but 21% of adjusted EBITDA in FY20, with adjusted EBITDA margins of 9% (FY19: 9%), which the group expects to push up to 15–20% over the medium term. In addition to supporting MGI's games division, providing cost-effective user acquisition, Verve has become a substantial advertising business in itself, focused on the SaaS-based programmatic and advertising technology segments. After more than 10 acquisitions, Verve now offers a fully integrated technology suite, incorporating a demand side platform (DSP), data management platform (DMP) and supply side platform (SSP) as well as a strong in-app ad-serving solution. The recent acquisition of video platform LKQD, from Nexstar Digital, adds additional video capabilities as well as a strong market position in smart TV and over-the-top (OTT) advertising.

MGI is building Verve into an effective media platform, with streamlined integration of acquisitions, to build critical mass and deliver cost savings. Management believes that Verve’s open exchange platform is now one of the top 20 programmatic marketplaces worldwide, meaning that Verve is well-placed to benefit from medium-term growth in the online advertising sector. eMarketer forecasts worldwide digital advertising revenues to grow at a CAGR of c 12% from 2020 to 2024.

Leverage: Remains within target range, before falling

Post-year end, MGI announced the acquisition of US-based KingsIsle (online PC games Pirate101, Wizard101) for US$126m in cash (up to US$210m including earn-out), covered in our recent note Acquisition of KingsIsle Entertainment. As at 31 December 2020, net interest-bearing debt amounted to €61.6m (31 December 2019: €34.9m), a net leverage ratio of 2.1x (FY19: 1.9x). However, net interest-bearing debt rises to €91.6m when adjusted for the acquisitions of KingsIsle and LKQD in January 2021, with net leverage of 2.0x pro-forma FY20 EBITDA (€46.0m). Looking ahead, even with a maximum payout for KingsIsle, management expects net leverage to remain within its target range of 2–3x FY21 EBITDA, before falling back towards the lower end of the range within 12–18 months through free cash flow generation. Management expects the fixed deferred consideration (30 June 2021/2022) to be paid from cash resources and operating cash flow, without the need for further financing.

Outlook: A balance between organic growth and M&A

After a record FY20, management has indicated that it also expects FY21 to be a strong year, although with more of a focus on operational growth than M&A. MGI has a number of games under development and expects strong continued demand for the existing games portfolio, with key games benefiting from being launched on new platforms as well as internationalisation (eg Trove, Wizard101 and Pirate101). Growth in FY21 is expected to be driven by a combination of organic growth from new game launches, internationalisation of proven IP, improved user acquisition, new content launches for existing titles as well as further M&A in both the games and media segments.

Management has set out the following KPIs for the business as its mid-term financial targets:

Revenue CAGR: 25–30% (FY20: 67% growth). FY21 consensus estimates: 22% growth. Revenue growth in FY21 is expected to be supported by organic revenue growth opportunities, together with a strengthening media business and M&A.

EBITDA margin: 25–30% (FY20: 19%). FY21 consensus estimates: 28%. the KingsIsle acquisition should support increased group margins, with management guidance of 66% EBITDA margins for KingsIsle in FY21.

EBIT margin: 15–20% (FY20: 12%). FY21 consensus estimates: 18%. As above, the KingsIsle acquisition should drive increased margins.

Net leverage: 2–3x (FY20: 2.1x). Net leverage is towards the top of management’s target range following the acquisition of KingsIsle. However, management expects net leverage to remain within its target range of 2–3x FY21 EBITDA even factoring in the largest payout to KingsIsle, before falling back towards the lower end of the range within 12–18 months.

MGI’s M&A pipeline remains full, with management indicating that it is in ongoing discussions with 10 companies (five games and five media businesses) and has contacted a further 25 businesses to explore the potential for a future deal. Management expects to complete further M&A deals in both the games and media sectors in FY21.

Valuation: Narrowed discount to peers

FY20 has seen a transformation in terms of MGI’s valuation, with the shares more than tripling over the last 12 months. Much of the valuation disparity of being a stranded games asset on the German market has now disappeared, but we would note that MGI still offers significant potential for margin improvement (following the acquisition of KingsIsle) and strong M&A-driven growth prospects, with management targeting sustained growth of 25–30% in the medium term. Consensus estimates imply 40% y-o-y revenue growth for MGI in FY21, with 17% growth in FY22, while EPS is estimated to grow by 30% in FY21 and 38% in FY22.

From our analysis, MGI trades at a material discount to the peer group based on sales metrics (c 50% discount) for FY21e and FY21e, but a narrower (but material) 30–38% discount based on EV/EBITDA. Management is targeting medium-term EBITDA margins of 25–30%, which compares to 30%+ for the peer group. Looking at FY21e, MGI trades on a consensus EV/sales multiple of 3.2x, an EV/EBITDA multiple of 11.3x (a 28.3% EBITDA margin) and a P/E ratio of 30.1x.

Exhibit 2: Peer group comparison (based on consensus estimates)

Year
end

Current price (ccy value)

Quoted currency

Market cap (€m)

EV (€m)

EBITDA margin 1FY (%)

EBITDA margin 2FY (%)

EV/
sales 1FY (x)

EV/
sales 2FY (x)

EV/
EBITDA 1FY (x)

EV/
EBITDA 2FY (x)

P/E
1FY (x)

P/E
2FY (x)

European peer group

Embracer Group AB

Mar-21

214.0

SEK

8,245

7,530

42.6

44.9

8.6

5.1

20.2

11.4

nm

nm

Stillfront Group AB (publ)

Dec-21

84.5

SEK

2,985

3,165

38.3

39.6

4.9

4.3

12.7

10.8

18.6

15.9

Modern Times Group MTG

Dec-21

114.9

SEK

1,097

1,422

15.6

18.6

2.7

2.3

17.3

12.4

45.0

31.8

Playway SA

Dec-20

554.0

PLN

805

773

71.7

75.2

18.3

11.4

25.6

15.1

22.2

19.5

Ten Square Games SA

Dec-20

499.5

PLN

800

768

33.8

34.7

5.7

4.6

16.8

13.2

19.8

14.9

Sumo Group PLC

Dec-20

296.0

GBp

587

580

23.9

24.4

7.6

5.2

31.7

21.4

42.3

32.0

Rovio Entertainment Oyj

Dec-21

6.22

EUR

508

423

17.0

16.5

1.5

1.5

8.9

9.0

16.8

15.3

G5 Entertainment AB (publ)

Dec-21

451.0

SEK

394

375

24.6

26.5

2.5

2.2

10.1

8.3

19.3

15.4

11 Bit Studios SA

Dec-20

530.0

PLN

276

252

63.0

46.0

13.6

17.5

21.6

38.1

33.8

68.4

Mean

36.7

36.3

7.3

6.0

18.3

15.5

27.2

26.7

Median

33.8

34.7

5.7

4.6

17.3

12.4

21.0

17.7

Media and Games Invest plc

Dec-21

3.54

EUR

456

547

28.3

25.6

3.2

2.8

11.3

10.9

30.1

23.2

Premium/(discount) to peer group mean

(56%)

(53%)

(38%)

(30%)

11%

(13%)

Premium/(discount) to peer group median

(44%)

(39%)

(35%)

(12%)

43%

31%

Source: Refinitiv data, priced as at 10 March 2021

General disclaimer and copyright

Any Information, data, analysis and opinions contained in this report do not constitute investment advice by Deutsche Börse AG or the Frankfurter Wertpapierbörse. Any investment decision should be solely based on a securities offering document or another document containing all information required to make such an investment decision, including risk factors. This report has been commissioned by Deutsche Börse AG and prepared and issued by Edison for publication globally.

Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2021 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

Any Information, data, analysis and opinions contained in this report do not constitute investment advice by Deutsche Börse AG or the Frankfurter Wertpapierbörse. Any investment decision should be solely based on a securities offering document or another document containing all information required to make such an investment decision, including risk factors. This report has been commissioned by Deutsche Börse AG and prepared and issued by Edison for publication globally.

Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2021 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

More on Verve Group

View All

Latest from the TMT sector

View All TMT content

Research: Industrials

OPG Power Ventures — Full power ahead

OPG has proved financially resilient through the COVID-19 driven economic slowdown, remaining healthily profitable and cash generative. As the Indian economy recovers (the OECD is forecasting 12.6% growth in 2021) demand for power will return. This should drive the recovery in sales and profits, in turn deleveraging the balance sheet, permitting a return to cash dividends and funding a strategy to develop renewables activities.

Continue Reading

Subscribe to Edison

Get access to the very latest content matched to your personal investment style.

Sign up for free