EXECUTIVE SUMMARY
Our valuation of Marsa Maroc is conducted within a favorable environment, where the Kingdom aspires to become a global logistics hub for Africa. A credible vision which is supported by Tanger Med II's new position as the 1st port in Europe and Africa in terms of operational efficiency in 2023. This model is set to be replicated at the ports of Nador West Med and Dakhla Atlantique, which benefit from a unique geographical positioning.
As a leader in the national port sector, with a market share of 40% and a presence in 24 terminals of the 10 largest ports in the Kingdom, Marsa Maroc is a key player in Morocco's port strategy. Also, the operator has launched its internationalization strategy in 2024 through the finalization of two strategic agreements in Benin and Liberia.
The accelerated deployment of this ambitious strategy relies on two main drivers. On the one hand, Marsa Maroc's ability to forge world-class partnerships with Hapag-Lloyd and CMA CGM, the 5th and 3rd largest shipping companies globally. On the other hand, the operator's strong ability to generate cash thanks to its attractive margin levels and good control of its WCR. As an indication, the EBITDA margin exceeds 52% and the CFO/revenue ratio stands at around 40% over the 2024E-2028E period.
At the end of our valuation, we come out with a target price of MAD 620, offering an upside of +15.0% over the next 18 months. Thus, we recommend BUYING Marsa Maroc stock.
Our key assumptions for the 2024E-2028E period are as follows :
- Marsa Maroc is expected to show a sustained AAGR of +9.5% in its consolidated revenue to
reach MAD 7.0 Bn at the end of 2028E. This is primarily driven by a ramp-up in transshipment
activity thanks to the strong dynamics of the port Tanger Med II and the commissioning of the
first phase of the East Terminal of the Nador West Med (NWM) port in 2027E; - The significant improvement in the volume of traffic handled by Marsa Maroc, combined with
the continued optimization of operating costs, would have a positive impact on the operator's
profitability. EBITDA would show a slightly higher growth profile than revenue, with an AAGR
of +9.8% over the same period. Ultimately, the Group’s profit would exceed MAD 1.7 Bn by
2028E against MAD 852.2 Mn in 2023; - The solid earnings growth would have a positive impact on the stock’s P/E ratio, which would
evolve from 34.5x in 2024E to 22.9x in 2028E. Nevertheless, it should be noted that our stock’s
valuation does not include important upsides, namely:
(1) The deployment of the Phase 2 of Nador West Med;
(2) The opportunities offered by the Kingdom's future ports such as Dakhla Atlantique;
(3) The internationalization in Africa which has already started with two new strategic
deals in Benin and Liberia.
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