| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 36.60 | -26 |
| Intrinsic value (DCF) | 22.59 | -54 |
| Graham-Dodd Method | 34.10 | -31 |
| Graham Formula | 79.80 | 62 |
Prosus N.V. (LSE: 0A28) is a global leader in e-commerce and internet services, operating a diversified portfolio of high-growth digital platforms. Headquartered in Amsterdam, the Netherlands, Prosus owns and invests in classifieds, fintech, food delivery, edtech, and other internet-based businesses across Latin America, Africa, Europe, and Asia. As a subsidiary of Naspers Limited, Prosus benefits from a strong backing while maintaining an independent growth trajectory. The company's key assets include stakes in Tencent (via Naspers), Delivery Hero, and other emerging-market tech leaders. With a market cap exceeding €246 billion, Prosus is a dominant force in the Communication Services sector, specifically within Internet Content & Information. Its diversified model mitigates regional risks while capitalizing on digital adoption trends in developing economies. The company's strategic focus on high-margin, scalable internet platforms positions it for long-term value creation in the rapidly evolving digital economy.
Prosus presents an attractive investment proposition as a diversified play on global internet growth, particularly in emerging markets. The company's €5.47 billion revenue and €6.88 billion net income demonstrate strong profitability, supported by its valuable Tencent stake and operating cash flow of €1.05 billion. With a beta of 0.697, it offers lower volatility than pure tech plays. However, risks include exposure to regulatory changes in key markets like China (through Tencent) and currency fluctuations across its global operations. The modest €0.10 dividend suggests a growth-focused capital allocation strategy. Investors gain exposure to high-potential sectors like fintech and food delivery without single-company risk, though the complex holding structure may create valuation discounts versus underlying assets.
Prosus occupies a unique position in the internet ecosystem through its hybrid model of strategic investments and controlled operating businesses. Unlike pure venture capital firms, Prosus actively manages portfolio companies like OLX and iFood, creating operational synergies across its 100+ investments. Its competitive edge stems from early identification of high-growth internet trends in underserved markets, particularly in classifieds (Avito, OLX) and food delivery (Delivery Hero stake, iFood). The company benefits from Naspers' pioneering experience in emerging market tech investing, creating a pipeline for cross-border knowledge transfer. However, its broad diversification may dilute focus compared to pure-play competitors. Prosus maintains an advantage in scaling platforms across similar geographies (e.g., applying Latin American fintech learnings to African markets), but faces increasing competition from regional champions and global tech giants expanding into its core markets. The Tencent stake provides financial flexibility but creates dependency on a single asset. Capital allocation discipline will be crucial as the company balances reinvestment in growth segments with shareholder returns.