Olainfarm AS (OLF1R, Nasdaq Riga)

Latvia based pharmaceutical company entangled into dispute between shareholders trading for less than 5 times last year’s earnings, growing top line at around 10% annually with consistently high ROE, trading at below company’s book value. We believe that shareholder disputes will resolve in time and will not fundamentally effect Olainfarm’s business prospects.

MCap 99M

PE 4.4

PBv 0.8

PS 0.7

DY 1% (5Y average)

ROE 14% (5Y average)

CAGR is 10%

Yearly stock trading volume is less than 10% making it an overlooked stock.

Olainfarm is the leading manufacturer in the chemical and pharmaceutical sector of the Baltic States with more than 45 years of experience.

Listed on NASDAQ Riga since 1997.

Olainfarm is is engaged in the manufacturing of finished drug forms and chemical pharmaceutical products in the Baltics. The group operates its activities through Medicine Production segment, Wholesale segment, Retail segment, Compression Materials segment and other segments.

Olainfarm exports to more than 60 countries worldwide and its main export markets are Russia, Ukraine, Belarus, The Netherlands, Kazakhstan, Uzbekistan, and
Germany. Farthest export market is Australia. Net sales break down geographically as follows: Latvia (29.4%), Russia (29.9%), Belarus (10.8%), Ukraine (9%), Europe (7.6%) and others (13.3%).

Olainfarm produces cardiological, neurologic, diuretic, spasmologic and antiallergic drug preparations, medicaments treating the digestive system, antibiotics and food supplements, as well as various active chemical ingredients and raw chemical materials. Its products include Amlodipine, Clonazepam, Euphillin, Furosemide, Furagin, Midolat, Protionol and Gripoflex, among others.

Company shareholders, who own 5% or more of issuer’s capital: Estate of Maligins Valerijs 46%, Nika Saveljeva 7.8%, Signe Baldere-Sildedze 7.8%, Irina Maligina 7.8%.

Financials and other info: https://lv.olainfarm.com/en/investors/

Long Olainfarm AS as of 01/21/2020

Purchase price: 7.22 Eu