Bigger stakes in Knowit and Systemair
The Stockholm exchange rose 2.4 percent in June, as did the small cap index. Carnegie Småbolagsfond rose 3.6 percent.
We have upped our stake in Knowit. This IT consultant has long shown fine development, with sales growth and profitability in a class of their own. The strategy consultancy has shown a somewhat weaker trend this year, but does not overshadow a business in very good shape. Covid-19 has naturally generated questions. We believe Knowit’s customers see them as an important supplier, and do not expect that demand has been significantly impacted. We view the stock to be at an attractive level and consider the valuation appealing.
“The greater focus on ESG could also lead to an appreciation of the share, given that Systemair should benefit. Either way, this is a fine and well-managed company that we can buy at an attractive valuation.”
We increased our holding in ventilation company Systemair. German ebm-papst group has been the second-largest shareholder since 1985, when it sold a company to Systemair. It is now selling half its stake, from 20 percent 10 percent. We took the opportunity to up our holding. We view the sale as undramatic and see the improved liquidity of the share as positive. Systemair has performed well this year, with good sales growth and profitability. We expect continued good demand ahead. Modern and efficient ventilation is increasingly important to meet the environmental requirements of the future. The greater focus on ESG could also lead to an appreciation of the share, given that Systemair should benefit. Either way, this is a fine and well-managed company that we can buy at an attractive valuation.
In light of positive figures from the truck market, and with order numbers for heavy trucks in North America clearly better than expected in June, we are optimistic about Concentric’s performance for the rest of the year. This has been a challenging period, but Concentric has still managed to demonstrate its usual good profitability. If demand returns, we expect good profitability growth. The company is at the forefront of electrification and has received breakthrough orders during the year. An interesting combination of a well-managed business, an attractive valuation and exciting prospects. The share rose 8 percent in June.