Caveat: This is my first crack at a valuation, so forget the pinch, grab a bucket of salt!
This is a partial valuation based on the aspiration of getting FDV LATAM to $100M USD which Shaun di Grigorio has stated in recent presentations.
Firstly, let's assume that it takes 5 years to get there. In FY23, LATAM had $45.2M AUD revenue. If we adopt AUD/USD $0.70, then current LATAM USD is $31.6M, so we need 3 fold growth. CAGR over last 6 years is 46% so if that continues, $100M in 5 years is achievable.
As FDV is still at breakeven, I've looked at REA FY22 for an NPAT margin. They are 29% NPAT/Revenue. If we take 80% of this, FDV NPAT in 2028 could be $23.08M USD (There's a few big leaps in faith here, I know!)
But pushing on, with current shareholding (no raises), EPS is 0.06 USD. Adopt a PE of 15 gives us $0.91, discount to 2023 at 10% gives us $0.54 USD. Adopt $0.70 AUD/USD and we get $0.77 AUD, 11% above current share price. And this is only for LATAM. FDV ASIA, mainly Zameen, is currently 8 times larger than LATAM by EBITDA (2.5 times on an ownership basis) and MENA is approaching EBITDA breakeven so by 2028 I would expect it to be contributing to the bottom line.
I know the 5 years to $100M USD is a bit aggressive, but I think the PE of 15 is a bit conservative.
There is of course the issue of the consideration for previous acquisitions which could trigger a capital raising and blow out the EPS
On the other hand there is also the float of EMPG, which will place a value on Zameen which could be quite favourable for an full company valuation.
I'm hoping this will get picked apart so I've got plenty to think about for my next crack.
Held in SM and RL.
