London, UK, 6 May 2022

OPAP (OPAP): Progressing the strategy

OPAP is a listed gaming operator with 100% pre-paid exclusive retail licences, which provide significant barriers to entry and strong recurring cash flow. In recent years OPAP has increased its online presence via a combination of organic growth and M&A, such that it is now the online market leader in Greece and Cyprus. Its Fast Forward strategy aims to grow OPAP’s customer interactions both online and offline while maintaining its leading position in corporate and social responsibility. This will be achieved through a combination of gaming innovation and brand investment, supported by improved technology and better customer relationship management. The key focus in FY21 was beginning the build out of the ‘infrastructure’, which will enable a step up in gaming innovation in the coming year, with management expecting incremental revenue and profits.

The share price has performed very well versus its peers during the last 12 months given OPAP’s improving operational momentum and the attractions of the new dividend policy. It continues to trade at a discount to its European peers, and its attractive dividend policy and cash generation ensure a superior dividend yield. Our DCF-based valuation indicates a fair value of c €18 per share (€16.3 previously).

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