DAVY VIEW

Due to uncertainty surrounding a possible bid for International Paper (IP) from Suzano, DS Smith trades at c.19% discount to IP’s recommended April 2024 offer. We expect the IP bid to be the focus at DS Smith’s FY24E results on June 20th. We model £701m DS Smith FY24E EBITA (in line with street). Despite labour and OCC raw material cost inflation, we expect positive DS Smith FY25E outlook, with sustained box demand recovery supporting higher box prices.