Home Most Popular Dino Polska: Investing in the Early Stages of Walmart’s Polish Cousin

Dino Polska: Investing in the Early Stages of Walmart’s Polish Cousin

Dino Polska: Investing in the Early Stages of Walmart’s Polish Cousin

Imagine if you had the opportunity to invest in companies like Walmart, Costco, or Kroger when they first started out. These retail giants have become household names, but finding similar opportunities in developed markets can be challenging. However, in Poland, a unique scenario is unfolding. Despite being part of the European Union and embracing capitalism, the country is still emerging from its post-war and communist past. This presents promising investment opportunities, such as Dino Polska, a supermarket chain that has quickly become a dominant player in the country.

Dino Polska, traded as DNOPY, has efficiently managed its growth and has significant potential for further expansion. This article will provide a comprehensive analysis of the company’s business model and its remarkable stock market performance. By the end, you’ll see why I consider Dino Polska a “Strong Buy” at its current price.

Business Overview

Dino Polska is one of the largest discount supermarket chains in Poland, operating a network of grocery stores. Its stores offer a wide range of food and non-food products, including fresh produce, dairy, meat, and everyday items. The company has rapidly expanded in Poland and has gained prominence in the retail industry.

Founded in 1999 by Tomasz Biernacki, who currently holds a 51% stake in the company, Dino Polska started with a single store in the Wielkopolska region. Its goal was to provide customers with proximity, quality, and variety in food and household products. Now, the company operates 2,272 stores across Poland, with a stronger presence in the less densely populated western regions.

The strategic plan for Dino Polska includes establishing a presence in smaller cities with populations of up to 5,000. This niche represents untapped opportunities for growth. Despite opening new stores at an impressive annual rate of 23% since 2014, Dino Polska still has room to expand in the sparsely populated eastern region of Poland.

Cost Control

Dino Polska’s success can be attributed to its tight control over costs, which enhances margins and deters competition. Notable strategies include store format standardization, investing in Agro-Rydzyna for streamlined meat supply, and establishing a dedicated construction company called Krot Invest for uniformity and real estate ownership. These factors reinforce the company’s vision and demonstrate that margin expansion is a deliberate and sustainable effort.

Key Ratios

Dino Polska’s growth has been remarkable. Since 2014, its revenues have grown at an annual rate of 32%, with EBITDA growing by 37% and net income by 42%. Effective cost control and increased scale have contributed to raising the EBITDA margin from 7% to 9%. The company’s growth in sales can be attributed to the expansion of new stores and increased revenue per store, which has grown at an annual rate of 7.5%. Dino Polska’s low Net Debt/EBITDA ratio of 0.56x showcases its strong finances and prudent capital allocation.


Looking ahead, Dino Polska is set to continue its impressive growth. I anticipate the company will open between 300 and 350 new stores annually, while revenue per store will continue to grow at a 7% compound annual growth rate. Based on these assumptions and conservative valuation multiples, the 5-year annual return is estimated to be 17.6% from the current price. Factors such as increased valuation multiples, margin expansion, or accelerated sales growth could potentially drive this return even higher.

Final Thoughts

Dino Polska may not appear to be a bargain based on traditional valuation metrics. However, when considering its growth in sales and profits, the company justifies higher valuation multiples. While geopolitical risks exist, the essential nature of the business and stable revenues derived from consumer food products offset some of the concerns. Considering the current valuation and growth potential, I give Dino Polska a “Strong Buy” rating.

Editor’s Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.