Inderes Group - Starting 2025 from a lower base - SEB

Inderes’ Q4 report prompts us to cut our estimates more than the headline deviations indicate. While IR software continues its solid growth, the commissioned research base took a step down. The company is now re-shaping its Swedish playbook, which we read as slower growth in 2025. The positives included cash flow (2024 FCF yield of 8%) and a thawing IPO market. Our fair value range is trimmed to EUR 19-21 (20-22).

Q4 outcome: Small miss owing to step back for Swedish research business

Inderes’ Q4 report fell slightly below our estimates, as the research business in Sweden surprisingly saw some contracts ending. Sales in Sweden declined by 12% y/y, which in our view is the most negative part of the report. The new year starts with a lower research contract base, which drags our estimates down. Although we still believe the IPO market will pick up, the starting point will be lower. Our 2025 sales estimate declines by 5% and we see now FY/25 sales growth at 4.6%, driven by AGMs, IR software and increasing IPO activity. We see the EBITA margin rising moderately in 2025, to 12.1%. The financial impact of the Videosync Europe deal is still uncertain and could turn out a positive trigger, both in the near and long term.

Reshaping the Swedish playbook

After missing its sales expectations in Sweden, Inderes is now reshaping its sales strategy in the country. For the research business to reach critical mass, the company says it still needs to build awareness in the market, which to us means slower growth projections versus the previous assumptions.

Fair value range slightly down to EUR 19-21 (from EUR 20-22)

Inderes’ FCF in 2024 was EUR 1.65/share; while that partly stemmed from a working capital tailwind, it reminds us about the group’s capital-light operating model and solid cash-flow conversion. Our DCF value remains broadly unchanged, but multiple benchmarking to peers sees our fair value range decline slightly.