elumeo looks set to benefit from two growth initiatives in particular which should help both top and bottom line performance going forward:

Growth avenue #1: juwelo. We currently expect much of H1'24e to be burdened by the continued muted consumer sentiment witnessed over the last quarters, estimating c. € 22m (eNuW) in sales for the first half of the year (flat yoy). While customer activity should be relatively unaffected overall for elumeo's core platform juwelo, the mix of both products and customers will likely reflect macroeconomic headwinds. However, whereas competitors like Wempe overwhelmingly offer higher-priced jewelry, leading customers to either stay or churn altogether, elumeo can prevent churn on its platform by offering both higher- and lower-priced items and allowing customers to simply subsititute one for the other. Thus, the average sales price is seen to decline compared to the prior reporting period (eNuW: € 72), but the number of items sold should steadily rise over the year to c. 645k (+2% yoy, eNuW) as (1) the continued development of an interactive mobile jewelry shopping app (eNuW: one-digit million figure or between c. 2-13% of FY'23e revenue) is expected to contribute perceptibly to FY total revenue by H2'24 and (2) AI translated automated shopping shows likely help reduce operating costs and boost video shopping content globally, the testing of which is still ongoing but already promising.

Growth avenue #2: jooli. The platform was launched in the Indian market to capitalize on both lower customer acquisition costs and a trove of data needed to enhance the app's algorithm and features such as livestream shopping (clips of ~20 seconds) of not only jewelry but various lifestyle products. While first KPIs like order volume are promising, jooli's development is financed out of the company's own resources and conducted such that customer acqusition is profitable from the beginning, causing a slower but financially healthier ramp up. Therefore, we currently do not expect material top or bottom line contributions from jooli before 2026e (see also our update from February 2nd). However, as the company prepares jooli for a successful roll-out in its European markets in the mid-term, elumeo's core platform juwelo looks set to benefit from an eventual recovery of the jewelry and overall e-commerce market with sales prices and items sold likely to recover.

We reiterate our BUY rating with an unchanged PT of € 5.00 based on DCF.