Sdiptech: Infrastructure for Growth

Initiating Coverage

2018-11-19

07:30

We initiate coverage of Sdiptech. Since the IPO of the preferred share in 2015, the company has made 24 acquisitions. Besides acquisitions, Sdiptech has an ambitious organic growth target of 5-10% annually, which we find optimistic. Nevertheless, we see potential for above-market growth rates in several subsidiaries – in niches such as Climate, Electricity and Water – due to their exposure to structural drivers such as sustainability, safety and convenience. Our Base case, excluding future acquisitions, is SEK 48 i.e. at a 20% premium to the current stock price.

FN

HA

Fredrik Nilsson

Henrik Alveskog

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