Management reiterates its guidance over FCFE (adjusted for spectrum) >E500m in 2015E; This is the reason we keep our OI rating on the name; we cut our EBITDA estimates for 2015-2016 by 3.0%-4.5% to account for the weak mobile and fixed Romanian businesses. OTE should exit the latter in our view (instead of increasing its stake). Greek fixed line performance is an oasis – will stay that way if GDP keeps Q1 2015 rate (+0.3% yoy in real terms) for the remaining of the year. Greek sovereign instability clouds our visibility but current valuation at 3.9x EBITDA 2015E is not demanding. Shares should re-rate upon Greece striking an agreement with creditors…contact@researchgreece.com

Judging Greek equities’ rise today (+3.4%) and in the last four sessions (+8.1%) we understand investors are optimistic that Greece will soon (within May) strike a deal with its creditors and avoid defaulting on its payments; If this is the case then Greek stocks and especially banks, which are down by more than 60% in the last 6 months (vs. 34% for ASE Index), are up for a rally; actually it has already started with banks up 27% if we count today’s +8.0% rise. Fast money will have a stroll but we cannot say the same for long-term oriented investors – not until we see tangible signs of reforms implementation and normalization; Greek Banks face so many issues (DTC; liquidity; quality; growth) and 2015 seems to be a ‘’lost’’ year. From a fundamental point of view we will continue to avoid the sector.

Investors have their eyes on the E233m sitting in the balance sheet; management said it is ready to give E150m (E1.4/share) back to shareholders – 27% of market cap – on state’s approval. The latter needs the money so a capital return seems like the only business plan there is for the water utility. We are not sure the government will bother planning any network expansion, leveraging up the balance sheet and/or merging EYDAP with EYATH (Salonica Water) – given it has its hands full with more urgent stuff currently. Athens Water is profitable and a good cash yielder (2015E FCFE 13%) and dividend yield could rise above 5% if payout goes >50%, on our estimates. Since we doubt the government will be unlocking any value anytime soon, we reiterate our DOI rating.

Stihima and Kino came in line; strong Joker (jack pots) and one-offs (impairment reversal, deferred tax) explain 11% beat on EPS; VLT guidance was revised downwards to 2.5k own machines in late Q2; sovereign risk weighs on the stock in the form of a) more on-line betting licenses tendered potentially breaching OPAP’s Stihima exclusivity (online) and b) higher gaming taxes (GGR, winnings) as the state needs the cash; We are not buyers at current prices given upside to our E10 PT; shares trade 6.5x EBITDA 2015E and dividend yield at 6.5%; based on VLT actual launch performance and Kino/Scratch impact we will be able to assess whether our 9% dividend yield 2016E is safe or not. We adjusted our legacy, VLT and lottery/SC assumptions, raising our EPS 2015E by 10%.

We up our 2015 EBITDA estimate by 60% at E400m – which would mark a record-high figure for MOH; driven by resilient refining margin (cost-driven), crude sourcing and max capacity…plus a quite strong dollar; FCFE >E200m should give the opportunity to deleverage the balance sheet <1.5x equity and accommodate a hefty dividend yield (>5%); we shift our valuation method to EV/EBITDA (vs. DCF), raise our PT but reiterate DOI on the shares on the back of…