What is going on with the NewPrinces stock ?

NewPrinces – formerly Newlat Food – is one of the three companies to which we have dedicated the most time and analysis over the past few years. We first presented our thesis and entered the position in early 2023, at €4.65 per share, when the company was still a regional Italian food operator with revenues below €800M and a market cap under €200M. Since then, through a disciplined and relentless programme of inorganic growth, it has become a European agri-food giant with revenues exceeding €7bn and over €400M of EBITDA. Its market cap has multiplied by more than four, and the Mastrolia family has delivered on everything they promised when we first analysed it.

The current NewPrinces is composed of four main pillars:

• Princes Group (LSE: PRN, 82.7% owned). The industrial backbone. £2.1bn of revenues across ambient foods, canned goods, fish, oils, and drinks in the UK and Europe. Listed in London in November 2025, with £400M of dry powder earmarked for further acquisitions. Margin recovery well underway: EBITDA margin expanded from 6.2% to 8.1% through 9M25 on procurement synergies and the exit from low-margin contracts.
• Carrefour Italia / GS (100% owned). 1,000+ stores across Italy, acquired in December 2025 following EC approval. Reported losses under Carrefour France (–€67M ROI, –€180M FCF) mask a standalone EBITDA of ~€115M once the €100M in Paris intercompany fees are removed. The elimination of overheads, the real estate and lease portfolio restructuring, the rollout of NewPrinces’ own brands across 1,000 points of sale, and the €445M GS relaunch plan represent a compelling set of levers that management is now in a position to pull for the first time.
• Plasmon + Diageo Operations Italy. Two high-margin, brand-led businesses leased internally to Princes. Plasmon (€170M revenue, 11.7% EBITDA margin) — Italy’s leading baby food brand. Diageo Italy (€234M revenue, ~9% margin) — spirits and RTD vertical, with B2B demand already exceeding expectations.
• Centrale del Latte d’Italia (70% owned). Italian dairy brands — Mukki, CDL Torino, Tigullio, Polenghi — now distributed across 1,000+ GS stores from day one. The simplest and most direct commercial synergy in the perimeter.

The journey has not been without turbulence. The stock has suffered corrections of -15% / -20% on several occasions. The most significant is the current one: from a high of €26.16 in August 2025, the stock has fallen more than 30% to the €18.52 it closed this Friday. The trigger was the Princes IPO on the London Stock Exchange in November 2025 — the single biggest communication misstep in NewPrinces’ history — which priced well below expectations and sparked a sell-off that has since been compounded by four months of M&A silence and, most recently, the macro shock of the Iran war.

Each time in the past, these corrections have been driven by market confusion about the complexity of the story — not by any fundamental deterioration. The question today is whether this pattern will repeat — or whether something has structurally changed. Today, we analyse the situation of one of the companies we best know and provide our independent view:

• Review the main drivers that brought the share price to its current level.
• Share our analysis of the FY25 results we expect.
• Examine the evolution of the Carrefour integration process and its implications.
• Provide an updated valuation.
• Present our opinion on the company’s current situation.

Why has the NewPrinces stock price been falling in recent months?

The poor performance of recent months has been driven by four factors:

• Poor momentum since the London IPO. The IPO of Princes in October 2025 was the trigger of the current correction and, in our view, reflects a genuine failure of investor communication. The company priced at ~£1.16bn — 25% below peer multiples and well below the £1.5–2bn the market had been led to expect — and in the four months since, the stock has lost a further 25%. We think the problem will persist until M&A announcements start flowing, as the market still reads NewPrinces largely as “the company that paid £700M for Princes and listed it at the same price”, with zero value attributed to the ex-Newlat perimeter — Carrefour, Plasmon, Diageo Italy, CDL — which remains entirely invisible to investors.
• Absence of M&A. Management flagged on the October call that Princes’ £400M would move quickly into new acquisitions. Four months of silence later, the market has lost patience. The explanation is straightforward — running Carrefour, Plasmon and Diageo integrations simultaneously is genuinely complex, and Mastrolia has never rushed a deal — but explanations do not re-rate stocks. The M&A machine is the core of the investment thesis, and we believe it is difficult to re-rate the stock without it.
• Iran. The last two weeks have turned the world upside down and have penalised the sector heavily on the implications of higher energy and oil costs for margins. We are aware of this — but we want to look at the other side of the coin as well. We are talking about a company with the strongest balance sheet in its sector, actively looking to make acquisitions at exactly the moment when multiples and target prices are starting to compress. Mastrolia was born for this environment, and we expect him to take advantage of it.
• Technical picture. The Iran war has broken what was shaping up to be a very constructive technical setup: the breakout above €21 on Friday February 27 had been pointing toward €24. After two weeks of correction, the stock is now testing the bottom of the channel at €18.5 — a level it must hold at all costs. There is a dangerous head-and-shoulders formation building that, in a combination of poor macro and unconvincing results, could send the stock significantly lower. Until March 31st, price action depends almost entirely on macro developments, barring a corporate announcement. The results on March 31st are where the game is played. To be clear — we expect them to be good, and if Iran stabilises we see a quick return toward €25. But this is an exercise in transparency about the things we are watching closely.