A heavyweight in online betting with Betclic, Banijay has also established itself as the undisputed European leader in audiovisual production since its acquisition of Endemol Shine. External growth remains its primary strategic focus, as evidenced by the recent acquisitions of Tipico - a choice target - in gambling and All3Media in production.
On a pro-forma basis, this results in a fivefold increase in revenue between 2019 and 2026, but also a significant increase in the number of shares outstanding. Given its ambitions and current solvency ratios, it is highly likely that further capital increases should be expected in the near future.
This, coupled with investor wariness toward gambling in Europe - subject to outright fiscal ransoming - and a float reduced to next to nothing, is possibly what has contributed to discouraging investors. Indeed, notwithstanding its phenomenal growth, Banijay trades at significantly depressed multiples of its operating profit.
In any case, this is a matter of long-term vision that will test the patience of the less-well informed. In this respect, the good news is that the group's structure - which will remain unchallenged as long as control by its anchor shareholders is guaranteed - will enable it to ensure its development, using the windfall from online betting to finance its expansion into content production, thereby becoming the partner of choice for streaming platforms.
Proponents of the management team will also point out that, even based on current depressed multiples, Banijay's consolidated valuation - which now generates over half of its operating profit from online betting - covers only this single segment; the highly profitable content production segment would thus be entirely overlooked.
This is for a group that, it should be remembered, aims to increase its revenue to €10bn by 2029, which has consistently exceeded its initial targets, and published excellent quarterly results yesterday.
