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We reiterate our Neutral rating on FFP. Despite the remarkable quality of FFP's portfolio

we see it as fairly valued (listed stakes’ value up 40% year-to-date, UBSe). The value of

the shares of PSA Peugeot have notably gained c70% year-to-date and now account

for 46% of the NAV of FFP. UBS has a Sell rating and a DCF-derived PT of €12 (30%

downside) on PSA Peugeot. We also don't see any upside potential for another c24%

of the portfolio (SEB, Zodiac, DKSH, …all Neutral rated) and therefore have a Neutral

rating of FFP. All in all, we see a 7% downside potential in the NAV per share of FFP in

Such a discount level is wide in absolute terms but is consistent with the 46% average

discount at which FFP shares have traded over the last 5 years (35-55% range since

2010). The modest liquidity of the shares (20% free float) indeed justifies a relatively

wide discount. Given the lack of upside potential in the NAV in a twelve-month view, a

wider discount could also be justified. FFP shares trade at 40% discount to our 12-

month forward NAV of €122, that implicitly assumes that (1) equity markets will remain

supportive and (2) that FFP will continue to smartly manage its portfolio.

Despite the value appreciation of several stakes, we doubt that FFP will sell much of its

existing assets (good quality, long term view). We believe on the contrary that FFP will

look for some new investments. FFP's loan-to-value has indeed decreased to less than

10%, which is very healthy and supports some re-leveraging. We estimate FFP could

invest up to €160m and keep a loan-to-value ratio below 15%. We expect new

investments either in listed or unlisted assets.

We have raised our 12-month forward NAV to €122ps from €114 to reflect the higher

market value of SEB and Lisi. Our PT, raised by 28% to €73, now assumes a discount of

40% (50% previously) to our forward NAV. A narrower discount looks indeed justified

to us given the stronger equity markets and good management of the portfolio.