GPS Participacoes (GGPS3.SA): Management meets investors

Research evidence excerpt

GPS Participacoes (GGPS3.SA): Management meets investors

Equity Research

23 June 2026 | 3:53PM BRT

On June 23, we hosted a group meeting with GPS’s management. Key topics of Joao Frizo, CFA

+55(11)3372-0103 | joao.frizo@gs.com

discussion included: i) Inorganic growth; ii) Labor and tax reform; iii) efficiency gains; Goldman Sachs do Brasil CTVM S.A.

and iv) capital allocation. Further details below. Bruno Amorim, CFA

+55(11)3371-0764 |

bruno.amorim@gs.com

n Inorganic growth. Despite a robust pipeline (~12 companies in the final stage of Goldman Sachs do Brasil CTVM S.A.

negotiation with a total revenue around ~BRL 4.7bn, as noted in their 2Q

conference call), GPS pointed out that it remains selective when acquiring

companies in the current macro environment. Moreover, the company notes that

their acquisition strategy focuses on target companies with low margins and

high indirect costs that can achieve a quick payback period once

incorporated into GPS’ structure.

n Labor reform. Management noted that the proposed labor reform (reducing

from a 6 days workweek to 5 days while reducing weekly working hours to 40

from 44) is expected to raise labor costs, which should be passed through to

GPS’s customers (in a similar way as yearly wage increases negotiated with labor

unions are passed-through). The company reinforced their focus on profitable

growth and that, if required, could end contracts operating at below-target

profitability once the reform takes place.

n Tax reform. The company expects the proposed tax reform to discourage

informality, due to a more simplified, straight-forward and easier to audit tax

structure in Brazil. However, GPS noted that, one of their subsidiaries operates

with a tax benefit (lower PIS/COFINS taxes) that will be extinct under the new tax