First Berlin – Deutsche Effecten- und Wechsel- Beteiligungsgesellschaft AG Research Update (30/09/2021)

First Berlin Equity Research has published a research update on Deutsche Effecten- und Wechsel- Beteiligungsgesellschaft AG (ISIN: DE0008041005). Analyst Christian Orquera reiterated his BUY rating and maintained his EUR 2.50 price target.

Abstract
Deutsche Effecten- und Wechsel- Beteiligungsgesellschaft (DEWB) has published its H1 2021 report and an update on its portfolio holdings. The financial results came in roughly as expected. Following the completion of the disposal of its non-core holding MueTec to the Chinese group TZTEK in May 2021, DEWB achieved a contribution to H1/21 earnings from the sale of investments of €9.4m (FBe: €9.4m). EBIT amounted to €8.5m (FBe: €8.6m; H1/20: €-0.7m). Management reiterated its FY/21 guidance of achieving a net profit exceeding €7m (FBe: €7.4m) and confirmed its intention to complete an additional acquisition in FY/21. The portfolio holdings developed as expected during the reporting period. DEWB's anchor shareholding, Lloyd Funds AG (LFAG), continued its sound operating performance in H1/21, and management confirmed the outstanding growth outlook through 2024. DEWB also invested an undisclosed amount in LFAG's WealthTech LAIC, which successfully raised €5m via a blockchain-based token offering to finance further growth. DEWB's factoring specialist Aifinyo, which suffered a negative impact from the Corona pandemic during FY/20, saw a healthy business rebound in H1/21. DEWB's Fintech portfolio is in our view highly promising, including its latest investments in the commission-free neobroker Nextmarkets, the marketplace for alternative investments Stableton, and the wealth management robo advisor LAIC. We continue to believe the company is significantly undervalued at current levels. We reiterate our Buy recommendation and our €2.50 price target.