SMC Research begins coverage and sees considerable potential in the share
- Price target: EUR 3.60
- Opinion: “Buy”
Berlin, 9 July 2021 – SMC Research has begun research coverage of The Grounds Real Estate Development AG (The Grounds / ISIN: DE000A2GSVV5). The opinion of the analysts in their first assessment is “Buy”, and they foresee a price target of EUR 3.60 per share, corresponding to a potential of 51% compared to yesterday’s closing price of EUR 2.38.
In their analysis, SMC emphasise several positive influencing factors that considerably affect their opinion.
Thus, after extensive changes in the shareholder structure, a strategic realignment last year led to a focus on German residential real estate properties which, in the analysts’ view, remain very attractive due to the significant excess demand. Changes in the Supervisory Board and a newly-appointed Management Board are highlighted as additional important assets.
The analysts expect from the experienced leadership team a successful implementation of the corporate business strategy. In addition to further considerable expansion of activities in developing residential properties, portfolio holding and privatisation, SMC sees great potential in an existing development portfolio with a planned investment volume of EUR 400 million. Finally, they say The Grounds sold a logistics real estate property very successfully here, which decisively influenced the earnings of the 2020 financial year and could yield further earnings of up to EUR 10 million based on a debtor warrant.
Referring to the strong figures in the 2020 financial year, with doubling of turnover to EUR 31.3 million, tripling of the EBIT to EUR 6.1 million and multiplication of the consolidated net profit to EUR 3.6 million, SMC speaks of a convincing overall picture of The Grounds Real Estate Development AG due to the combination of its positioning, future prospects and team. The coverage begins with the assessment “Buy”, and a price target of EUR 3.60.
The Grounds Real Estate Development AG
Arndt Krienen/Jacopo Mingazzini, Board Members
Charlottenstrasse 79-80, 10117 Berlin, Germany
Tel.: +49 (0) 30 2021 6866
Fax: +49 (0) 30 2021 6849
Ingo Janssen, Managing Director
Haus der Wirtschaft, Kapstadtring 10
22297 Hamburg, Germany
Tel.: +49 (0) 40 6378 5410
10179 Berlin, Germany
Tel.: +49 (0) 30 284 49 87 62
About The Grounds
The Grounds Group realises housing projects in German metropolitan regions. In addition, The Grounds Group holds a steadily growing residential portfolio as fixed assets. The Grounds Real Estate Development AG is listed in the Düsseldorf Stock Exchange’s OTC segment Primärmarkt (ISIN: DE000A2GSVV5), has its seat in Berlin and an office in Stuttgart.