Original-Research: Global Fashion Group S.A. (von NuWays AG)

Classification of NuWays AG to Global Fashion Group S.A.

Company Name :	Global Fashion Group S.A.
ISIN:	LU2010095458
Reason for the research:	Update
Recommendation:	BUY
from:	29.10.2025
Target price:	EUR 0.80
Target price on sight of:	12 months
Last rating change:
Analyst:	Henry Wendisch

On November 7, GFG will post its Q3 figures, for which we expect muted NMV and sales, but visible gross margin improvement. In detail:

LATAM and ANZ driving GMV recovery, SEA underperforming. As the company´s efforts to turn around customer decline continue, particularly in LATAM and ANZ (where customer growth already outpaced churn in Q2 ´25), we forecast a less pronounced decline in LTM active customers (eNuW: 7.43m; -1% yoy), and consequently a decline in orders (eNuW: 3.8m; -4.4% yoy). However, this should be partially offset by a higher average order value, which is estimated to grow 2% yoy, despite FX effects. Thus, group NMV should land at € 252m (-1.6% yoy), reflecting a lower decline vs H1. On a regional level, LATAM should grow by 1% yoy to € 71m, driven by higher active customers (eNuW: 3.5m; +2.9% yoy), but held back by FX headwinds. ANZ should follow the same path, increasing 2.1% yoy to reach € 127m, benefiting from a higher customer base (eNuW: 1.93m; +1.3% yoy), offsetting some negative FX effects. Conversely, the business environment remains challenging in the SEA region, where we expect € 54m, or a 12.1% yoy decline, which should derive from a lower customer base (eNuW: 2m; -9% yoy) combined with a lower average order value (-9% yoy) and negligible FX effects.

Sales to decrease as Marketplace gains share. As GFG´s goal to increase Marketplace share of NMV should continue in Q3, Retail share of NMV should decrease by 1pp yoy to 61%, while this should be directly reflected in a 1pp yoy Marketplace share gain, to 39%. Given that a Marketplace share gain of NMV usually drives the sales to NMV ratio down (since only 22% of marketplace NMV is converted to sales: i.e., the take rate), we forecast a sales to NMV ratio of 65% (-3pp yoy). As a result, group sales should arrive at € 164m (-5.7% yoy). Regionally, we see LATAM sales decreasing by only 2% yoy to € 44m, which already reflects an improvement versus H1 (-3% yoy). In ANZ, sales should decrease by 2% yoy to € 85m, while in SEA we estimate sales to decrease by 10.3% yoy to land at € 36m, broadly in line with regional NMV developments and marketplace share gains.

Higher gross margin built to last. GFG has continuously improved its gross margin over the past six quarters, being able to raise it sequentially from 44% in Q1´24 to 47.7% in Q2´25. This was achieved through a combination of actions at both retail and marketplace business levels. On one hand, for its retail business, the company has offered less discounts (due to its active reduction of old inventory), while it has successfully negotiated better terms with brands. On the other hand, given that marketplace carries a gross margin close to 100% (given no COGS are incurred), a higher marketplace share of NMV translates to an overall higher gross margin. Overall, for Q3 we estimate a continuation of this trend, thus we should see gross margin improving by 2.7pp yoy to reach 46.5%. In fact, gross margin should improve across all regions yoy (LATAM: +0.8pp yoy; ANZ: +2.2pp; SEA: +1.8pp), due to a higher marketplace share of NMV in each region.

Overall, we maintain our strong conviction on the investment case due to the already visible improvement in gross and adj. EBITDA margins, coupled with positive FCFs in the broader future (eNuW: FY´27e). Given that GFG is priced for insolvency, as it trades at a negative EV, the re-rating potential appears attractive, in our view. Therefore, we reiterate our BUY rating and keep our PT unchanged at € 0.80 based on DCF.

You can download the research here: global-fashion-group-sa-2025-10-29-previewreview-en-53ed2
For additional information visit our website: https://www.nuways-ag.com/research-feed

Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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