I bought Plejd AB on the Stockholm Stock Exchange. https://mb.cision.com/Main/13880/3954746/2704773.pdf They make lighting systems similar to Philips Hue, but with a B2B focus aimed at making life easier for electricians. Megatrends like smart construction and energy savings play into their hands, and the company is growing profitably In reality, what happened was that I just went to our Swedish office and shouted in the hallways asking what cool things they’ve found on the stock market, and Christoffer, one of our Swedish analysts, pitched this to me. SEB also initiated equity research on this today, but I can’t find it on their website.
As for risks, I think the moats aren’t that strong; couldn’t electricians just as easily buy other brands, like Philips Hue? Which I have at home too and works really well, but it’s definitely more intended for consumer use. Then again, why wouldn’t Philips be more aggressive on the B2B side? There will probably be price pressure as more players push into the market, unless it’s already crowded as it is.
Looks good, but accounts receivable have jumped quite a bit over the past year. At least it doesn’t seem to bother the market—after all, the share price has doubled in a year—but what is the reason for it? Considering the developments in the construction sector, one might even think there’s a risk of credit losses lurking there.
SEB has initiated coverage of Plejd with a target price of 400 SEK.
Plejd has experienced significant growth in recent years, and SEB expects it to continue at this pace. The company has expanded its product range and market areas, which has fueled growth. New products, such as smart lighting, are expected to double sales in the Nordics. Furthermore, the company is entering new markets, such as the Netherlands and Germany, which offers significant growth potential.
According to SEB’s analysis, Plejd has reached a solid scale where scalability is starting to become evident. Operating expenses remain relatively stable while sales grow rapidly—a nice combination. SEB predicts that Plejd’s EBITDA margin will grow significantly in the coming years.
According to SEB, Plejd is one of the fastest-growing product companies in the Nordics, but its valuation is not yet stretched. The target price is based on a forecast that Plejd will continue to grow for a long time.
The Swedish analysis firm Kalqyl, by the way, is providing analysis on Plejd: https://kalqyl.se/plejd
They apparently don’t believe receivables are an issue because the wholesalers are quite reliable and Plejd’s customer base consists largely of them. I haven’t read their analysis before
SEB is really good at hiding these analyses. These are apparently the kind of analyses given only to the wealthy, and a peasant in Helsinki isn’t allowed to read them , because I can’t find them, even though there is an analysis of Inderes here, for example, which we pay them for: SEB Research
Hi, the products look somewhat similar to those of Shelly Group (SLYG), I wonder if there are many differences even though they resemble each other in appearance and functionality?
And of course, considering the differences between the companies from an investment perspective.
Comparing catalogs, Plejd focuses more on lighting control, while Shelly has a wider range of meters and switches installed in electrical cabinets. The similarities lie in those basic relays that switch loads on/off based on defined scenarios.
The more versatile control/management of the Plejd system seems to require the purchase of a mesh gateway, whereas Shelly’s relays and such can be connected directly to a WLAN network. (Excluding Bluetooth dongles or other limited special cases like ZigBee, etc.)
With Shelly, expansion scripts can be entered into the app; in Plejd’s case, they would likely need to be entered through home automation software, which the gateway then passes to the devices. The solution is likely carefully considered.
In summary - Plejd has, in my view, tried to “Apple-ishly” trim away the engineering clutter from its products, leaving those more interested in tinkering as Shelly customers. I would guess this also appeals to electricians - the simpler the installation and the more limited the (customer’s) potential for fumbling, the better.
I’ve asked a couple of installers for comments on Shelly installations, and the response is something like “if I absolutely have to.” There has been a slight fear of acting as the customer’s IT support if some control doesn’t work. In electrician training, there is (presumably) a separate IT-electrician track, and without a personal hobbyist interest, new “smart relays” cause uncertainty about one’s own skills and the durability of the devices. For some, it is important to have the products on the lists of wholesalers like Onninen or similar; I assume this facilitates billing and warranty replacements.
Disclaimer: I have a couple of Shellys installed in my household, controlling a few LED strips on/off. Since some simple Shelly relays operate on 12V voltage, an electrician is not needed for the installation. At the same time, I would point out that these WLAN-connected IoT devices should be isolated in their own network, with appropriate restrictions set for traffic between networks.
@Yu_Gong, your interview brought this company to mind. Have you come across or thought of anything new regarding this company? If you could get some fresh comments from Christoffer, that would be great.
In the interview, Christian von Koenigsegg (yes, he is connected to that mega-car) spoke about Plejd, which is his largest publicly listed investment; valued at nearly half a billion kronor. He sees the investment as a long-term one and remains positive about the company.
He believes that Plejd has huge potential, especially in the European markets. According to him, the company has a strong brand, reliable technology, and a stable platform (?), and they are constantly developing new features. In his view, the company is only at the beginning of tapping into its potential.
Someone on Nordnet mentioned that Plejd might be expanding its product range to thermostats. We should ask Christoffer to inquire about this in their webcast. Will this have an impact on the company’s numbers?
“New product categories Plejd’s growth strategy focuses on launching new product categories to broaden the customer base in each market. Previously, the company’s main focus was on the puck series. However, 2023 marked an important year as Plejd launched its second product category: smart luminaires. The company plans to introduce two more categories during 2024 and 2025. The next major launch, scheduled for 2024, is in the area of smart heating control. This is part of the company’s ambition to diversify and expand its product portfolio.” What I can found is that it is expected to be launched in Q4’24. The initial plan was to launch it in 2023, but was delayed.
So by the end of 2024 they will have smart lightning, smart luminaries, smart window covering, and smart heating (thermostat). In the latest Q2’interview Babab (CEO) said that in coming year(-s) they will broaden these offerings before they introduce new categories
It’s nice to see that a discussion about Plejd has started. I’ve meant to start one myself several times but haven’t gotten around to it. I’ve been a shareholder since 2017 and a user of the system for about a year.
First, the user experience: It just works. Many smart home gadgets have the flaw of being about 98% reliable, and it’s annoying when systems don’t work. I have experience with Hue, Shelly, Ikea, SmartThings, etc. With Plejd, there haven’t been any disruptions. Personally, I wouldn’t have the patience if something as basic as the lights in the house worked poorly or with a delay, etc. Many DIY automation enthusiasts probably like Shellys and such because they offer more possibilities, but these are perhaps not Plejd’s target audience. Additionally, based on my experience, Plejd’s own motion sensor is superior compared to Hue, for example, and the system’s vacation mode automatically simulates normal lighting times instead of having to program each lamp separately.
Our electrical designer recommended Plejd for our construction project. They’ve installed thousands of Plejds, and the defective ones can be counted on the fingers of one hand. Apparently, they refuse to install Shellys because they don’t want to be supporting and replacing broken gadgets. This is just from one installer, of course, and it’s not meant to put those others down.
As an investment case, I see Plejd’s ease/reliability as an advantage. Most people are completely clueless about these things and take whatever the installer recommends to them. The selection is constantly expanding, which helps growth in Sweden; Norway seems to be following in Sweden’s footsteps, and Finland is coming along behind. New products are released regularly, and the floor heating thermostat in particular sets a direction for Plejd, showing a desire to expand beyond lighting into home automation more broadly.
Value of installations in Norway +46% vs. revenue growth +24.4%. Offhand, I can’t think of anything other than speculation about wholesalers clearing out their inventory? This should show up as strong sales to Norway in the next quarter?
As Babak notes, the recessed luminaire has been well received and has likely significantly helped the growth in Sweden. It is indeed attractively priced for its features Link DWN-02
Interest in the thermostat in Norway has been talked about for a long time, and apparently, a large proportion of houses in Norway use electric heating. It will be interesting to see the comments on this in the Q4 report, continuing into next year. Combined with the first point, will Q4/24 be a Norway-blowout?
Finland’s slow adoption is puzzling. Both Norway and Finland were entered in 2019, and Norway’s sales are 4x higher. The Netherlands and Germany will soon overtake (readers, go buy some devices now). Of course, using the term “slow” is a bit questionable when revenue grew 45% in Finland’s “declared dead” construction industry.
I’ve also been a Plejd shareholder since last spring, ever since Christoffer pitched the idea. The valuation is certainly starting to look wild in this vertical climb, but for now, I’m trying to hang on as there have been no cracks in the story and the construction market should start providing tailwinds again in the coming years.
I quickly gathered the growth data and shares of different markets from recent times. The change in installation value is an interesting data point that the company included in this report. It’s certainly the best metric for organic growth, as the company itself mentioned.
Great effort! However, sales growth in Norway is small, even though Babak says that TRM-01 started strongly and Norway is prioritized in deliveries early in the year. The Netherlands overtook Finland, which is very positive
In reality, what happened was that I just went to our Swedish office and shouted in the hallways asking what cool things they’ve found on the stock market, and Christoffer, one of our Swedish analysts, pitched this to me. SEB also initiated equity research on this today, but I can’t find it on their website. 
, because I can’t find them, even though there is an analysis of Inderes here, for example, which we pay them for: 
