As of May 23, 2025, Hotel Chocolat Group PLC has a Discounted Cash Flow (DCF) derived fair value of $339.05 per share. With the current market price at $374.00, this represents a potential upside of -9.3%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $159.59 |
| DCF Fair Value (10-year) | $339.05 |
| Potential Upside (5-year) | -57.3% |
| Potential Upside (10-year) | -9.3% |
| Discount Rate (WACC) | 6.3% - 8.3% |
Revenue is projected to grow from $204 million in 07-2023 to $435 million by 07-2033, representing a compound annual growth rate of approximately 7.9%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 07-2023 | 204 | 10% |
| 07-2024 | 211 | 3% |
| 07-2025 | 225 | 6% |
| 07-2026 | 240 | 7% |
| 07-2027 | 262 | 9% |
| 07-2028 | 297 | 13% |
| 07-2029 | 316 | 7% |
| 07-2030 | 341 | 8% |
| 07-2031 | 372 | 9% |
| 07-2032 | 405 | 9% |
| 07-2033 | 435 | 7% |
Net profit margin is expected to improve from -3% in 07-2023 to 7% by 07-2033, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 07-2023 | (6) | -3% |
| 07-2024 | (2) | -1% |
| 07-2025 | 1 | 1% |
| 07-2026 | 6 | 2% |
| 07-2027 | 10 | 4% |
| 07-2028 | 16 | 5% |
| 07-2029 | 18 | 6% |
| 07-2030 | 21 | 6% |
| 07-2031 | 23 | 6% |
| 07-2032 | 27 | 7% |
| 07-2033 | 30 | 7% |
with a 5-year average of $16 million. Projected CapEx is expected to maintain at approximately 9% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 07-2024 | 18 |
| 07-2025 | 19 |
| 07-2026 | 20 |
| 07-2027 | 19 |
| 07-2028 | 23 |
| 07-2029 | 25 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 5 |
| Days Inventory | 168 |
| Days Payables | 72 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 2024 | 19 | (0) | 19 | 1 | (1) |
| 2025 | 25 | 0 | 21 | (1) | 5 |
| 2026 | 30 | 1 | 22 | 1 | 7 |
| 2027 | 36 | 1 | 24 | 1 | 9 |
| 2028 | 46 | 2 | 27 | 2 | 15 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 159.59 | -57.3% |
| 10-Year DCF (Growth) | 339.05 | -9.3% |
| 5-Year DCF (EBITDA) | 174.12 | -53.4% |
| 10-Year DCF (EBITDA) | 277.49 | -25.8% |
Is Hotel Chocolat Group PLC (HOTC.L) a buy or a sell? Hotel Chocolat Group PLC is definitely a sell. Based on our DCF analysis, Hotel Chocolat Group PLC (HOTC.L) appears to be fairly valued with upside potential of -9.3%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider a hold at the current market price of $374.00.