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Ukrainian agricultural holdings undervalued relative to world peers – expert

KYIV. Sept 15 (Interfax-Ukraine) – Groups of companies of the Ukrainian agro-industrial complex, which shares are listed on the Warsaw Stock Exchange (WSE), are undervalued relative to global agricultural holdings, mainly due to the good ratio of EBITDA and debt obligations and the ratio of EBITDA and the value of companies from Ukraine.

The data of analyst of the Polish bank mBank Jakub Szkopek were published at the WSE on Tuesday.

"For many years, Ukrainian companies were considered unattractive in terms of debt levels. Now the situation is changing. Astarta is due to pay off its obligations at the end of this year, in the case of Kernel, we expect a debt ratio of 1.3xEBITDA. In this situation companies willingly pay dividends or decide to buy out their own shares," the exchange quoted its data.

Szkopek said that the Kernel agricultural holding has a ratio of the company’s total value and its EBITDA three to four times, Astarta – about two times, while holdings from the agro-industrial sector of other countries of the world are estimated at about 10xEBITDA. Thus, there is a significant potential for growth in the value of Ukrainian agricultural holdings.

The expert recalled that at the end of July, Kernel’s shareholders authorized their board to buy back up to 19.2 million of their own shares for a total largest amount of $250 million. In addition, this year Astarta paid EUR 12.5 million in dividends (EUR 0.50 per share), and also announced the buyback of half of its shares (12.5 million shares) at a price not exceeding PLN 125 per share.

In turn, the agricultural holding IMC paid EUR 20.57 million in dividends (EUR 0.62 per share) to shareholders in June this year. The company has been distributing profit in this way for the fifth year in a row.

Securities of the agricultural holdings Kernel, Astarta, IMC, Ovostar, Agroton, KSG Agro and Milkiland are listed on the WSE.