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Balco: A project on hold, looking well-rehearsed - SEB

As Balco Group’s clients are likely to continue to struggle to discount a proper financing cost in pending projects and convert to orders, we cut mainly our order intake and sales estimates over our forecast period to 2025. Ongoing savings and annualised cost inflation should bolster EBIT margins ahead. Balco Group’s balance sheet is strong leaving 2022 with net debt, excluding leases, at SEK 22m. We set our revised mid-point equity value at SEK 70 (80).

As Balco Group’s clients are likely to continue to struggle to discount a proper financing cost in pending projects and convert to orders, we cut mainly our order intake and sales estimates over our forecast period to 2025. Ongoing savings and annualised cost inflation should bolster EBIT margins ahead. Balco Group’s balance sheet is strong leaving 2022 with net debt, excluding leases, at SEK 22m. We set our revised mid-point equity value at SEK 70 (80).
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