Agriculture
November 18, 2014
Ovostar was able to improve its 9M14 EBITDA by 19% YoY to USD 21.1mn in spite of the obvious adverse effects of this year’s hryvnia devaluation on the company’s Ukrainefocused sales model. Offsetting the deval were the positive impact of lower grain prices on feed input cost, higher sales volume, and UAHdenominated price appreciation. Growth in operating results over the next year will only partly compensate for the new UAH devaluation wave, and we expect EBITDA at USD 25.0mn in FY15, down from USD 32.3mn in FY14E. Our target price of PLN 80.80 implies a HOLD recommendation for the OVO stock.
