Byggmästaren extensive report: Proven track record meets an attractive entry point

We initiate coverage of the investment company Byggmästaren with an Accumulate recommendation and a target price of SEK 66. While the company has delivered strong long-term shareholder returns since its 2014 IPO (16% annual TSR), recent years have shown softer performance relative to peers and relevant benchmark index, reflecting strategic pivots and challenging market conditions in parts of the portfolio. We view the second largest holding Green Landscaping and the relatively new holding DP Patterning as key value drivers with attractive upside potential at current valuations. We consider the remaining portfolio holdings, including the largest holding Safe Life, to be fairly valued. That said, we view the current P/NAV discount of -16% to be too steep when considering Byggmästaren’s overall investment track record, historical discounts, current portfolio composition, and strong balance sheet, creating an attractive risk/reward at current levels.

Proven long-term track record despite recent softness

Byggmästaren is an investment company focusing on long-term value creation through active ownership in a concentrated portfolio of small- and mid-sized companies. It invests in both listed and unlisted companies, primarily in Sweden and the wider Nordic region, with no stated exit horizon.  While Byggmästaren’s origins date back to 1898, its modern structure was established through the Alby real estate initiative in 2013 and the subsequent IPO in 2014. Since then, the company has evolved from a real estate owner into a situation-driven investment company (2018) and, more recently, into a more formalized investment company (2024). Since 2014, the total shareholder return (equity growth and dividends, TSR) has been 16% per year, placing Byggmästaren among the best-in-class investment firms, despite periods of large net cash positions. Corresponding net asset value (NAV) growth has been 13% annually. While the track record since the IPO is strong, the performance over the past three years paints a weaker picture, with NAV growth and TSR lagging the relevant benchmark index and most of the investment companies that we have compared it with.

Concentrated portfolio with Safe Life as the largest holding

The portfolio comprises six holdings, half of which are unlisted. Three of these are what Byggmästaren refers to as core holdings, making up nearly 60% of NAV. Safe Life, a buy-and-build company within AED* distribution, has dominated the portfolio for several years and still represents ~35% of NAV despite the partial divestment in 2025. The other core holdings are Green Landscaping (~23% of NAV, listed), an outdoor maintenance and landscaping consolidator, and DP Patterning (~5% of NAV), a small technology company producing sustainable flexible printed circuit boards. In our view, these companies determine Byggmästaren’s direction, and we see the latter two as the current value drivers within the portfolio. With Safe Life, following the transaction in June 2025, we view its valuation as relatively neutral with limited near-term upside. Green Landscaping has faced operational and market headwinds over the past two years, pressuring growth and margins, but we believe the share price reaction has been excessive and that the valuation is now attractive. For DP Patterning, we forecast rapid and profitable growth, which we expect to be driven by its strategic business model shift, ongoing capacity expansion, strong value proposition, and early commercial traction. While we believe execution risk and customer concentration elevate uncertainty, we view the current valuation as too conservative, leaving attractive upside potential.

Fair value range of SEK 54–77 per share

We value Byggmästaren through a sum-of-the-parts (SOTP) analysis, which indicates a fair value range of SEK 54-77 per share. Given its track record, active ownership model, net cash position, and portfolio concentration, we believe a reasonable P/NAV is within the range of -10% to -3% (vs 3-5Y avg. -14% & -9%), with -5% at our midpoint scenario. In our valuation, we believe that we have been relatively conservative in our assessment of the portfolio holdings. Overall, we consider Byggmästaren's current share price and implied P/NAV discount creates an attractive risk/reward.