Investment Idea

Express certificate on Fuchs Petrolub SE, with memory and airbag

Thanks to lower taxes, FUCHS PETROLUB has seen its earnings shoot up – but share prices have tumbled

At 4.75% p.a., our new investment idea offers attractive returns at a time when shares in Fuchs Petrolub SE are experiencing a sideways drift, while a real cushion offers security when prices drop. Fuchs Petrolub SE is headquartered in Mannheim, and is among the world’s largest producers of lubricants. The company employs more than 5,000 employees globally and achieved turnover of 2.57 billion euros in 2018.

Fuchs Petrolub SE is a family-run German company specialising in the production of lubricants. With more than 100,000 customers around the globe, it is one of the world’s largest independent suppliers in this segment. The company is headquartered in Mannheim and supplies more than 10,000 individual products to a range of industries, including aerospace, aviation and automobile manufacturing, as well as to companies in the energy and transport sectors. 16 out of 18 analysts’ reports available have a “buy” or “hold” recommendation for stock in Fuchs Petrolub SE (source: Bloomberg). If shares are delivered upon maturity of the certificate, the shares would be delivered with a markdown of 21% on the starting level.

Fuchs Petrolub SE share price in euros, 5-year view

After reaching an all-time high of EUR 47.25 in August last year, the lubricant manufacturer's share price plunged at the end of 2018 and since then has tended around the five-year average price of around EUR 34.30. The company is forecasting weaker growth for the current year. DATA BLOOMBERG

How the express certificate with memory and airbag works

The Société Générale express certificate on Fuchs Petrolub SE, with memory and airbag, is a bearer bond of Société Générale Effekten GmbH. It matures on 6 May 2025, except in instances of early redemption.

Interest payments

Fuchs Petrolub SE shares are reviewed on the observation date in question to ascertain whether they are at or above the interest barrier of 79.00% of the initial fixing. If this is the case, an interest amount of EUR 47.50 (4.75% per period) will be disbursed in arrears as a one-off payment for each certificate, plus any interest amounts that may not have been disbursed previously (memory effect). If this is not the case, no interest will be disbursed. In the event of early redemption, interest payments will not be made subsequently.

Early redemption

Fuchs Petrolub SE shares are reviewed on the observation date in question to ascertain whether they are at or above the relevant disbursement level. If this is the case, the certificate will be repaid early at par value. Otherwise, the certificate will continue to run until the following observation date.

Maturity date

The final fixing will determine whether the Fuchs Petrolub SE shares are quoted at or above the strike price of 60.00% of the initial fixing. If this is the case, the par value will be paid for each certificate. Otherwise, the underlying asset will be physically delivered at the subscription ratio (with fractions being settled in cash).

Express certificate with memory and airbag

ISIN DE000ST6W4D0
Underlying Fuchs Petrolub SE
Coupon 4.75% p.a.
Maturity 72 months
Issuer Société Générale Effekten GmbH, Paris
Coupon barrier 79%
Strike price 79%
Issue price 101.50%
Subscription period 27 March 2019 to 26 April 2016, early closing possible
Currency Euro
Express level After 12 months = 100% / then annual step-down of 5%

Your contact person

Roman Schmid

Co-Head of Client Advisory Switzerland

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