Industrie Chimiche Forestali: Strong Cash Generation, Resilient Business Mix and Undemanding Valuation Support Buy Rating

Analyst Andrea Zampaloni of Alantra Equities maintained a Buy rating on Industrie Chimiche Forestali SpA, retaining the price target of €8.50.

Andrea Zampaloni has given his Buy rating due to a combination of factors linked to Industrie Chimiche Forestali’s profitability, cash generation, and valuation. The company delivered stronger-than-expected EBITDA in 4Q25 and expanded its margins thanks to lower input costs and disciplined cost control, even though volumes were still under pressure in luxury and leather. Full-year results showed an EBITDA margin above 13% and robust free cash flow, enabling the group to remain effectively debt-free on an underlying basis after accounting for IFRS-related items. This strong balance sheet was achieved despite significant cash outflows for share buybacks and dividends, underlining the sustainability of cash generation.

Andrea Zampaloni’s rating is based on the view that the business mix is becoming more resilient as the company accelerates diversification into automotive, packaging, and broader industrial applications, partially offsetting the weakness in luxury and footwear. While he remains cautious on the timing of a recovery in the luxury segment, he maintains his FY26–27 estimates, expecting continued solid margins and shareholder returns via both dividends and buybacks. He highlights that the current share price implies an FY26 EV/EBITDA multiple of about 4.4x, which he sees as too low relative to the company’s track record of earnings quality, expanding profitability, and strong free cash flow. Consequently, he confirms a target price of €8.5 per share, representing approximately 38% upside, and reiterates a Buy recommendation.