Me too Bob and sb9. Had $14k in my sharesies account looking for a home and when the SP dropped below $3.40 i was going to put it in for some more shares but didnt for whatever reason.
MST access has put a new valuation of $5.43. You can access the free research here: Research Notes - MST Access you just need to create a login.
FY24 result: Revenue of $66.5m (+22% pcp) was largely in line and EBITDAof $27.4m (+63%) was a strong beat against guidance of $24.0m (and vs ourown estimate of $24.9m). We note the result did not include the full impact ofthe CBI contract rollout, which will provide added benefit to FY25.
Balance sheet strength to support digital strategy: the strong resulthighlights the margin and cash flow benefit being achieved as the companyscales its ATM and merchant footprint (now ~49k as last reported), the latterof which is particularly key to Findi's digital strategy. FindiPay is currently only~10% of revenues vs management's longer-term goal of 30%.
Upgrades to earnings outlook drive valuation upgrade: we have bumpedour revenue and EBITDA expectations for FY25, but more meaningfullyincreased our forecasts for FY26 (refer to financial summary), once the fullimpact of the expected White Label ATM license and SBI rollout is realised.We await further FY25 guidance in the coming weeks.
Investment Thesis
Only Australian-listed way to gain access to Indian fintech market: Asone of the world’s largest non-bank ATM operators in a very large market,Findi services >2.7m customers daily in India across >49k locations, involvingboth ATMs and merchants. We expect this footprint to continue growingalongside population growth (from 1.4 bn currently), a reduction in theunbanked population (estimated at ~25% presently) and further adoption ofdigital payments, even while cash remains king.
Leveraging ATM & merchant stronghold to cross sell digital services:Findi is uniquely positioned as an end-to-end provider (the only fintechprovider that provides both ATMs and digital services) that can leverage itsbasic cash services, as a cheap customer acquisition channel, to furtherdevelop into a full-service digital banking provider. Both business segmentsprovide significant diversification benefits across cash and digital.
Current earnings multiple highlights value on offer: Applying aconservative market multiple of 10.5x to our updated FY25 EBITDA forecastof $32.4m results in a valuation significantly higher than the current shareprice.
Valuation
Findi’s earnings outlook underpins our valuation based on a 10-yearDCF and market EBITDA multiple (equally weighted). Our valuation of$5.43/share (up from $4.31) is supported by growth in Findi’s ATM networkand services which should drive revenue and profitability.
Risks
Key risks to our thesis include macroeconomic risk (related to Indianeconomic health), regulatory risk (which govern Findi’s ability to providepayment services), management execution risk and key client risk.