Essity Aktiebolag - Fundamental Investment Case

Essity used to be part of SCA (forest products firm) and was split off by shareholder resolution in 2017. Its name stems from the words “essentials” and “necessities”. Operates across tissue and hygiene sectors. It is the market share leader in Europe but gets no more than low-teens sales from any 1 country.

In this report, Vision Research highlights qualitative and quantitative concerns on the investment case. Competitive landscape from both discounters and white label are putting margins under pressure.

Margins have contracted for multiple quarters as higher price/mix and  volumes have failed to compensate for increased raws. Furthermore, Pulp capacity in future years is not favorable, with sharply decelerating growth in the face of rising demand.

This price of this report includes a one-on-one session with the analyst.