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Belreca: An Investment Holding Trading At A Discount With The Overhead Cost Of An ETF

Mar. 07, 2020 11:25 AM ET11 Comments


  • Belreca is an investment holding with the majority of the shares controlled by one single family.
  • The company's dividend has been increasing or kept at least stable for longer than two decades.
  • Despite the market turmoil, the share price hasn't decreased which means the discount to the NAV/share has decreased.
  • The stable share price is likely caused by the lack of trading in this holding. Be aware of low trading volumes.
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Every once in a while one can come across a company that may not look interesting at first sight but gets more intriguing after completing a deeper dive into the financial results and business model. Belreca (no US listing) is an excellent example of this type of company. This tiny and obscure holding company with no secondary listings is firmly controlled by a private banking family which owns over 2/3 rd of the shares. The intrinsic value of the company is much higher than where the share price is at and the continuously increasing dividend is also very appealing.

Source: Yahoo Finance

Belreca has only one listing, on the Double-Fixing market of Euronext Brussels (which means there are only two trading moments per day, and limit orders are required). The average daily volume in Brussels is approximately 80 shares (although there have been some heavier trade days in the past few weeks with a few hundred shares changing hands on a daily basis, and some days where there was no volume at all, so working with a limit order is imperative). The ticker symbol is BELR and the current market cap based on a share price of 125 EUR and less than 316,000 shares outstanding is 39.5M EUR. Note: some brokers appear to be using the full name of Belreca so in case there are no search results for ‘Belreca’, try ‘Belgian Resources and Capital Company’.

Belreca also has a very annoying website which does not contain ‘unique’ URLs as all direct links are contained within the normal website page. You can find all relevant information HERE.

Belreca: a listed holding that shouldn’t even be public…

Belreca is one of the strangest companies I have ever encountered. Not only is this a small holding company, it is also family controlled as

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This article was written by

The Investment Doctor profile picture

The Investment Doctor is a financial writer, highlighting European small-caps with a 5-7 year investment horizon. He strongly believes a portfolio should consist of a mixture of dividend and growth stocks.

He is the leader of the investment group European Small Cap Ideas which offers exclusive access to actionable research on appealing Europe-focused investment opportunities not found elsewhere. The a focus is on high-quality ideas in the small-cap space, with emphasis on capital gains and dividend income for continuous cash flow. Features include: two model portfolios - the European Small Cap Ideas portfolio and the European REIT Portfolio, weekly updates, educational content to learn more about the European investing opportunities, and an active chat room to discuss the latest developments of the portfolio holdings. Learn more.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (11)

still tremendous undervalued . They did not follow the momentum in the stock market
interesting to buy now . Seems like they did not yet go up much since the March dip. What is the discount now ?
The Investment Doctor profile picture
Considering you have the share positions (which you need to update for the recent sale) and access the share prices, you can easily calculate the NAV yourself, no? ;)
I do iT this week end
The Investment Doctor profile picture
Sorry, lack of time. But please share your findings, it will be useful information for all of us!
Thank you for your article, very interesting to cover such kind of stocks.
Doc, the tax structure is pretty simple : after applying dual tax treaties, taxes withheld at source are 15% of dividends for US, Switzerland and the rest of Europe except UK and Belgium. Taxes payable in Belgium are 30% except when the cost of acquiring a particular line was more than 2.5 Million Euros whereby taxes are 0 (used to be 5% at corporate income tax @33% = 1.67% until 2017) due to what is called the mother-daughter tax rate.
The Investment Doctor profile picture
Thanks for the 2.5M EUR requirement, that makes sense wrt the final tax bill of Belreca!

Didn't the corporate tax rate decrease to 29.58% and will decrease again next year to 25%? Not that it really matters for Belreca...
I suppose not a lot of international investor will trade in such illiquid Belgium Holding company . And even for the local people only interesting if they want to invest over the very long time for income and not trade for capital gains . Local people pay a high dividend Tax and no capital gain tax and therefore also not that interesting for local people to trade this stock unless the discount is unusual high
The Investment Doctor profile picture
My guess would be zero.
Kelbor Del profile picture
All political parties who can not agree on a new government have been loudly voicing "Belgium's need to increase the tax on the revenue of capital"

Tax increase is one particular are where these parties are not constipated.

(Disclosure: Long AED, COFI, INTO, WDP)
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