Pole Position: UBS European & US Autos Daily

Research evidence excerpt

Pole Position: UBS European & US Autos Daily

Global Research

31 July 2026ab

Pole Position Equities

Europe including UKUBS European & US Autos Daily

Automobiles

Patrick Hummel, CFA

Sinochem sells 14% stake in Pirelli to Lumina Crown Analyst

According to multiple press articles, Sinochem has sold a 14% stake in Pirelli to patrick.hummel@ubs.com

investment company Lumina Crown, which is backed by Czech investor Strnad. As a +41-44-239 52 54

result, Sinochem's stake will fall to c20.1%, while Lumina Crown will become Pirelli's David Lesne

third-largest shareholder. According to la Repubblica, the block trade deal was executed Analyst

at a value of €6.5/share, broadly in line with last night's close. david.lesne@ubs.com

+33-14-888 3034

Our view: Joseph Spak, CFA

One of the main investor pushbacks on Pirelli has been the potential share overhang Analyst

since the Italian government applied Golden Power rules on Sinochem. These rules will joseph.spak@ubs.com

+1-212-713 3089

apply as long as Sinochem's stake in Pirelli is >9.99%. We also note that Camfin, Pirelli's

second-largest shareholder with 26%, has scope to potentially increase its stake to Juan Perez-Carrascosa

29.9% (see press article). Therefore, post the block trade, the potential overhang left is Analyst

limited to c6% net, in our view, which could mitigate the investor concern. Furthermore, juan-perez.carrascosa@ubs.com

+34-91-436 9025

we believe Pirelli has an attractive equity story, mostly due to its deleveraging potential,

which could drive strong earnings growth. We model >10% CAGR25-28E. Despite its Paul Gong

cost of debt increasing from c2% in 2020 to <4%% today (peak >5%), Pirelli has been Analyst

able to contain its net interest expenses at c€200m, still representing c40% of its net paul.gong@ubs.com