FY'25e outlook: RE recovery and new mid-term targets

20% dividend increase likely: Given MLP's target payout ratio of 50-70% (eNuW: 60%) and our estimated EPS of € 0.64, we expect FY'24 dividend proposal of € 0.36 per share (+ 20% yoy; 6% yield). Mind you, the dividend is tax-free under § 27 KStG.

Old mid-term targets to become new FY'25e guidance: This year, MLP's mid-term targets of € 100-110m EBIT (eNuW: € 102m), € 62-68bn AuM (eNuW: € 63bn) and a non-life insurance volume of € 730-810m (eNuW: € 780m) are due and will become the FY'25e guidance, which should be well in reach.

New mid-term targets to be announced: Also on March 13th, MLP will announce new mid-term targets, which the CFO said are "as ambitious as the previous mid-term targets", potentially serving as a share price catalyst.

Changing mix in EBIT drivers for FY'25e: While FY'24e EBIT stood under an strong contribution from performance fees (eNuW: € 28m; 9M'24: € 26m), we do not assume a similar development for FY'25e although it could be possible. On the other hand, the still negative real estate segment Deutschland.Immobilien (eNuW: € -14m EBIT in FY'24e), should benefit from a noticeable market recovery (e.g. the recent announcement of a brokerage partnership with Dutch RE developer Ten Brinke Group for a € 160m RE portfolio of € 160m). As confirmed by management multiple times and also expected by us, this segment is seen to return to EBIT breakt-even in FY'25e (eNuW: € 16m EBIT increase from RE). The remaining segments should show similar profitabilies in FY'25e, except for FERI, whose FY'24 EBIT will mark a tough comparable base due to the € 18m EBIT effect of performance fees (eNuW) in FY'24e and us not assuming significant performance fees for FY'25e. - see p. 2 for details

Following the operational development, MLP's valuation should catch up accordingly. Therefore, the stock remains one of our Alpha Ideas and we reiterate out BUY recommendation with unchanged PT of € 12.50, based on FCFY'24e and SOTP.