Report

Blue Cap - Business as usual

Blue Cap's solid 2018 results were epitomised by a 15% rise in NAV and a positive trading statement. Management confidence in continued operational gains across the board and long-term turnaround potential at Knauer is complemented by an increasing appetite for transformative investments. However, such optimism risks being obscured by the demands of its new major shareholder, PartnerFonds (44%), even if hitherto settled judicially in favour of Blue Cap management, and now looking to be resolved amicably in the interests of all shareholders. Despite more challenging conditions (consensus forecasts have been reduced), the 40% share price discount to NAV (€29.55 at December 2018) appears excessive.
Underlying
Blue Cap

Blue Cap AG is a Germany-based holding company investing in medium-sized companies in the industry sector. The Company's portfolio includes companies in the areas of adhesives, special machinery, medical and measurement technology and precious metals. It distinguishes five business segments: Coating technology, Adhesive technology, Production technology, Medical technology, Precious metal recycling and trade. Its portfolio companies include NESCHEN Coating GmbH, a producer of adhesive-coated films; PLANATOL GmbH, a producer of glues; Gaemmerler GmbH, a manufacturer of printing systems; nokra Optische Prueftechnik und Automation GmbH, a provider of measuring and testing systems; em-tec GmbH, a developer of blood flow measuring devices; INHECO Industrial Heating and Cooling GmbH, a developer of thermo-electric components; Carl Schaefer Gold- und Silberscheideanstalt GmbH, a precious metals processing company, and knauer Holding GmbH & Co KG, a plastic cup supplier, among others.

Provider
Edison Investment Research
Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts
Richard Finch

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