Rai Way (AO) | Buy | Results in line, no news on the M&A front

研报英文原文证据摘录

Rai Way (AO) | Buy | Results in line, no news on the M&A front

Rai Way Buy | Target Price: EUR6.70

Company description Management

Rai Way is one of the largest broadcaster tower operators in Italy, with over 2,300 Giuseppe Pasciucco, Chairman

sites covering 99% of the population. Its main shareholder is RAI (65%), which is Roberto Cecatto, CEO

also its main client (85% of revenues in 2024). Rai Way provides media Adalberto Pellegrino, CFO

distribution services (mainly TV and radio broadcasting services to RAI and other

TV and radio stations) and digital services (mainly hosting and connectivity Key shareholders

services). Rai Way is expanding into new digital infrastructure, like hyper-scaler, Free float 34.93% RAI 65.07%

Edge DC and CDN

Investment case Valuation methodology

Rai Way's business model offers high cash flow generation We value the core assets including the diversification by using a

visibility thanks to its contractualised business, with >80% of DCF model, with a 9.1% WACC

revenues committed from the main client Rai, inflation Our TP includes a 70% probability of the deal with El Towers and

protection, low sensitivity to the macroeconomic cycle, and the re-leveraging effect, which adds EUR1.5 per share.

secured returns on most incremental investments. A best-case scenario (100% merger probability, maximum capex

While the DTT and radio listenership/consumption are not for diversification and re-leveraging) would result in a fair value

growing, we see a path for growth and value creation in a of >EUR7.5 per share.

potential merger with EI Towers and in diversification into Risks to our rating

adjacent digital infrastructure and media distribution. No deal with EI Towers, or deal at unfair terms for Rai Way (too