The insatiable appetite for ecommerce-related companies was confirmed by InPost’s Amsterdam trading debut on Wednesday. Shares in the Polish parcel pick-up locker provider rose 20 per cent, valuing the group at €9.5bn. The deal provided a partial exit for its private equity owner Advent, which took the then Warsaw-listed group private in 2017 for just €100m.
The deal follows the very successful October flotation of Polish online marketplace Allegro, InPost’s biggest customer. Allegro shares back then received strong demand and jumped more than half on its first trading day. Lex thought the biggest risk to Allegro would be Amazon’s entry into the Polish market. Amazon announced it would be doing just that on Wednesday, sending Allegro shares 7 per cent lower. However, that news only strengthens the case for InPost.
InPost supports Poland’s ecommerce companies with automated parcel machines. These allow customers to collect goods purchased online, reducing delivery costs for vendors. Advent’s investment has helped the group expand its number of parcel points to 11,000, enough to achieve a profitable scale.
Good thing, too, as business there is booming. InPost revenues doubled to €367m in the first nine months of 2020 producing an ebitda of €140m. Even more is expected next year. That values InPost, on Lex’s numbers, at about 30 times 2021 ebitda. Hardly cheap, but less dear than a pure ecommerce retailer such as Allegro on 40 times forward ebitda.
Even better, earnings growth should outpace that of its online retail clientele. Given its model and modest competition, InPost should snatch market share from traditional delivery services. Economies of scale mean its profit margin should expand as use increases at its installed facilities.
Whatever threat Amazon may pose to Allegro, nothing prevents the US ecommerce leader from becoming an InPost customer too, at least in Poland. Amazon has plans for its own drop box systems elsewhere in Europe. But for now, InPost offers investors niche exposure to the growth of ecommerce in Europe.
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