Original-Research: THE NAGA GROUP AG (von NuWays AG): BUY

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Original-Research: THE NAGA GROUP AG - from NuWays AG

20.09.2024 / 09:00 CET/CEST

Dissemination of a Research, transmitted by EQS News - a service of EQS

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Classification of NuWays AG to THE NAGA GROUP AG

Company Name: THE NAGA GROUP AG

ISIN: DE000A161NR7

Reason for the research: Update

Recommendation: BUY

from: 20.09.2024

Target price: EUR 1.40

Last rating change:

Analyst: Frederik Jarchow

New game changing cooperation with Telegram; chg.

Topic: Yesterday, the Group´s CEO Octavian Patrascu presented its growth

plans for NAGA during our roundtable. Further, he announced to have entered

into a cooperation with the messenger Telegram. Our key takeaways:

First-ever fully integrated trading app within Telegram. As a first mover,

NAGA is the first broker that natively integrated its full trading offering

into the Telegram ecosystem. Customers now can do the whole onboarding and

KYC process without leaving the Telegram app. Further, onboarded customer

can use all the features of the NAGA Super APP within the Telegram app. In

our view, the integration of the NAGA SuperApp into the Telegram ecosystem

with its c. 950m users is a bold move, that should massively increase the

reach of NAGA and lower entry barriers for potential new customers. As a

result, number of new customers should increase significantly. Further

customer activity should increase as well, as receiving a trading signal and

placing a trade is no longer separated in two different apps. At least not

from a user´s perspective.

Promising growth ambitions unveiled. Similar to the recently announced

cooperation with BVB, the cooperation with Telegram is another important

milestone on NAGA´s growth path. According to its internal plan, NAGA

expects to grow to EUR 129m in sales until FY26e, achieving some EUR 31m EBITDA.

This is clearly above our conservative estimates of EUR 103m in sales and EUR

21m EBITDA, but not out of reach. Keep in mind that an incremental positive

change in the sentiment could have an enormous effect on the P&L of NAGA.

The leverage of the joint Group could even scale this effect.

For FY24, we are anticipating EUR 71m in sales and an EBITDA of EUR 8.6m (12%

EBITDA margin), slightly below the internal plan on the topline (EUR 75m) and

above on the bottom line (EUR 8.7m). Obviously, investment into future growth

could burden margins in the short-term.

Overall, the revitalization of customer activity in the brokerage space,

paired with cross-selling and synergy effects arising from the merger and

important strategic cooperations should fuel NAGA´s growth going forward.

BUY with a new PT of EUR 1.40 based on DCF

You can download the research here: http://www.more-ir.de/d/30825.pdf

For additional information visit our website: www.nuways-ag.com/research

Contact for questions:

NuWays AG - Equity Research

Web: www.nuways-ag.com

Email: research@nuways-ag.com

LinkedIn: https://www.linkedin.com/company/nuwaysag

Adresse: Mittelweg 16-17, 20148 Hamburg, Germany

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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben

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1991999 20.09.2024 CET/CEST

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