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 1.80 price target.

Abstract
DEWB has published its financial statement for H1/23. Overall results were roughly as expected. The company reported no revenues and EBIT of €-0.4m (FBe: €-0.5m; H1/22: €-0.5m). Interest expenses rose to €0.4m (FBe: €0.3m; H1/22: €0.2m) chiefly due to higher ST borrowings (H1/23: €8.1m vs YE/22: €5.2m). On 30 June, the company succeeded in refinancing the expiring €15m 4% 5-year bond with a new €6.6m 8% 5-year bond (2023/2028). As the company’s credit line has much better terms than the bond, the company has now shifted part of its total debt to the credit line with its principal bank. DEWB’s current credit limit amounts to €9.0m, so that the company still has financing scope of ~€0.9m. With this amount, operations can be financed for ~one year, during which time a holding exit should take place. The company is still guiding for an exit before YE23. The net result came in at €-0.8m (FBe: €-0.8m; H1/22: €-0.7m). According to management, apart from the two troubled neobrokers which show signs of recovery, the remaining companies from DEWB’s investment portfolio have healthy operations and have performed satisfactorily despite the current challenging market environment: 1) DEWB’s core investment LAIQON expanded its assets under management to €6bn and is on track to achieve break-even by the end of 2023, even without performance fees. Importantly, LAIQON recently entered into a memorandum of understanding for a cooperation agreement with Union Investment Group. A joint product using LAIQON/LAIC’s AI-based asset management approach will be established for distribution by Union Investment among its customers in the cooperative financial network (Volks- und Raiffeisenbanken). This deal is a key milestone for LAIQON as Union Investment is one of Germany’s largest asset managers; 2) Aifinyo maintained its profitable growth; 3) Neobroker Naga reported a third consecutive profitable quarter following restructuring; 4) Neobroker Nextmarkets received financial support from main investor Apeiron (Christian Angermayer) to continue operations and merged with the data analysis and indexing company ADRIX to strengthen its competitive position; and 5) private holdings Stableton and Cashlink are well financed. Based on unchanged estimates, we reiterate our Buy recommendation and price target of €1.80.