On Dimitars incentives and Schneider Electrics bid on Shelly Group.

Looking at the official statement from Shelly Group and a more customer oriented note on Facebook from Dimitar himself we can conclude a few things.

• The deal will allow Wolfgang Kirsch and Svetlin Todoro (Salisto Holdings)  to cash out on their holdings.
• Dimitar Dimitrov will reinvest some of his sales proceedings to retain a minority ownership in Shelly Group.
• There is a promise from Schneider Electric that Shelly Group will keep operating as an independent company but with substantial support and collaboration from Schneider.

I am not surprised to see Wolfgang and Svetlin seeing this as an opportunity to cash out and do something different in their lives while securing generational wealth. At the same time, Dimitar who is more of an intelligent fanatic can, at least in theory, maintain his role and vision but within a corporate structure where he does not need to worry about the stock market. So I can see the personal incentives for each major stakeholder in the deal. Therefore I do not think that acceptance of the deal indicates that these people no longer believe in the future of Shelly Group.

The question is now whatever independent shareholders want to accept this deal. We live in uncertain times and Shelly Group remains a relatively new and unorthodox company coming from Bulgaria, so I think it is hard for international investors to break out of valuation window of P/E 30-40 for the coming years profit. Which is insane if you dare to extrapolate current growth and cash flows more than 1-2 years ahead. On the other hand it is also hard to imagine paying less than that for a company with such growth prospects, so I consider Shelly a company with an exciting development profile but boring valuation until we (presumably) one day hit a ketchup effect where people start seeing a European growth company rather than a Bulgarian micro cap.

So my back of the envelope calculation is that a valuation of P/E 30e in the current year is a "neutral" valuation (ie 900 meuro) and that I would then expect a valuation increase of 30 % per year past this coming from organic growth with relatively stable margins. This means that if the currently proposed deal goes ahead, minor shareholders will cash out at a valuation which we could otherwise expect to see roughly one year from now. Personally I don't see a lot of companies with an equivalent growth profile and verified business model as Shelly. I also strongly suspect that Schneiders strategy is the usual of capitalising on previous unrest, make a lowball offer and then increase the offer a bit to make people feel that they have won. So the question is really if I can get paid my expected valuation 1, 2 or 3 years ahead of time with the final offer from Schneider Electric and I think anything less than 3 years ahead is a loss for me as a rational shareholder even if I for personal reasons got stronger incentives than usual to cash in early (I got a house purchase coming up and will either need to sell Shelly, IT consultant Arribatec or oil companies). 

I do however think that the current offer is both a disservice to early private investors in Shelly and that Dimitar is getting himself into trouble by getting stuck in the Schneider corporate structure. Swedish investors are well aware of how Schneider completely failed to capitalise on Plejds market leading knowledge in smart lighting systems and I think the main lesson learned from Schneiders side is that they want to have more control over their next investment, which Dimitar is now giving them. 

Swedish finance profile and entrepreneur Petter Hedborg (@PCG_H) yesterday offered to bet 10 dimmers on that Dimitar Dimitrov will have left the company within 24 months of the deal closing. To anyone who has listened to Dimitars conference calls and got any knowledge about Schneider Electrics corporate culture this definitely does not look like a bet you would want to take.

Dimitars message on Facebook:

A personal note from Dimitar Dimitrov, co-founder of Shelly — on the Schneider Electric offer and what stays the same

I have been reading your comments here and in the other Shelly groups over the past days. Some of you are worried, and I understand why. Many of you have seen what happens when a small company you love is acquired by a large one: the website changes, the documentation disappears, the registration stops working, support becomes a ticket number. So let me answer the actual questions, one by one, as the person who founded this company and who continues to run it.

First, the most important thing.

Whatever happens with the announced offer, the way Shelly works does not depend on it. Local control, open API, no cloud dependency, the same team building the products and answering you here — this is not a promise tied to a deal. It is how we have always built the company, and it is how we will keep building it.

Who runs Shelly?

The same people as today. I stay, the whole management team stays. The engineers who write your firmware, the people who answer you in this group, the team in Sofia — all of them stay. Shelly remains a separate company with its own team, its own brand and its own products. If the offer completes, Schneider Electric would become our long-term partner and shareholder, supporting us to do more of what we already do — not to do something different.

Why does Schneider Electric want Shelly?

Because of what Shelly is, not despite it. The interest is in the community, the open approach, the speed and the products you already know. Changing that would make no sense for anyone — least of all for a partner who values exactly these things.

Local control, open API, no cloud dependency

This stays. Your devices keep working locally, without cloud, without an account, with the same open local API, MQTT, webhooks and integrations with Home Assistant, openHAB and everything else you use today. Nothing about how your devices work in your home changes.

Website, documentation, knowledge base, firmware

These are ours and we keep running them. Same documentation, same knowledge base, same release process, same firmware team. We are not migrating you to someone else's portal.

Support

Same team, same channels, same people. This group stays. I will keep being here.

What actually changes for you?

Honestly — nothing you will notice. What we hope changes over time is that we can build more products, faster, and bring Shelly to more countries and more professional installers. That has always been the plan, and a strong partner can help us get there.

I know that words are cheap and that you have heard "nothing changes" before. So judge us by what we do: the firmware releases, the new products, the answers in this group. That is how Shelly earned your trust, and that is how we intend to keep it.

Thank you for caring about this. It means you care about Shelly, and that is exactly why we are here.

Dimitar Dimitrov

Founder & CEO, Shelly Group

Shelly, going through the sales channels from a consumer perspective

 

Normally I write in Swedish, but as Shelly is a Bulgarian company with Germany as its largest market and with significant international interest I will write this in English.

For new readers, I recommend translating my annual portfolio summaries. I am active as http://aktieingenjoren.bsky.social/ on Bluesky and @Aktieing on X. Overall X is more active but the signal to noise ratio is better on Bluesky so if you want a more in-depth discussion I recommend commenting here or on Bluesky.

A key factor in my investments is to understand customer behaviour. I focused on this in my first analysis of Shelly (link) as Phantas had already done the quantitative analysis. When doing that analysis, I also made a lot of mental comparisons to Ubiquiti, a US-based technology I invested in and which in 2017 faced significant headwinds in investor sentiment as “exotic” exposure to East European manufacturing eroded investor confidence. Using open source intelligence, I made my own investigation (link) and this will be a similar exercise focusing on the following questions:

• 1      Are Shelly a genuine growth company with tangible sales?
• 2       Is there something going on with the growth in receivables?
• 3.      Do I trust management?

Is Shelly a genuine growth company?

A big advantage with consumer oriented companies is that it is much easier to evaluate their sales channels. For me the number one question as an investor is if I understand the consumer behaviour. For Shelly this means keeping track of success (or lack thereof) on key markets. In the case of Shelly the key markets for monitoring are Germany (Shelly's largest market), Sweden (home of Plejd) and the Netherlands, Finland and Norway as these are markets where both companies are expanding.

If we look at Idealo.de it is clear that Shelly is very successful in in Germany. Browsing through various categories, we see Shelly repeatedly placing themselves among the most popular products with key products being light switches and energy meters.

The Swedish rankings are a bit more frustrating to browse. In Sweden, Shelly is getting a fair amount of traction as an alternative to Plejd dimmers but I think this may actually help them more in other categories by separating them from companies like Aqara and Sonoff. Shelly provides the 6^th  highest ranked product for Smart control units behind Athom, Philips Hue, Plejd, TP-Link Tapo and Aqara. 4^th for smart senders and receivers behind Plejd, SwitchBot and Aqara. 3^rd for smart plugs behind Plejd and Deltaco and 3^rd for dimmers behind Plejd and a single Aqara product.

 

In the Netherlands I’ve used Tweakers.net which is a website for tech oriented people. Shelly got the 2nd and 4th for most viewed in energy measurement devices and is strong across the list, Loqed is the nr 1 most viewed brand for smart locks and Shelly is the most viewed smart plug and second most viewed dimmer switch under switches.

The next two charts require some consideration. In the first one I relied on Search topics with the company names which show what I consider an unrealistic boost in 2025. I suspect that the topics are still too niche for consistent results and that Shelly during 2025 passed some kind of threshold.

 

Taking a more naïve strategy using brand names as search terms generated some more interesting results. Home Assistant is the dominant open source software for smart home applications which makes it an interesting proxy for smart home interest. What we see here is that in Germany, Home Assistant (Yellow) and Shelly follows each other in growth over the last five years. Aqara (red), a widespread international smart home equipment provider got a far lower marker share and Plejd (green) is non-existent. In Sweden, which contains a large population of early adopters there was already at the start of the period a high penetration of Home Assistant while Plejd is the major growth star. There was a short-lived short hype for Shelly in 2023 but market presence has clearly increased again during 2025 both according to the data and my personal experience. What is really interesting is how the Netherlands also show the pattern of being a mature market for Home Assistant. Home assistant is however proportionally far higher than the main brands in Sweden and Germany while Shelly is ahead of Aqara. We also know from public filings that Plejd is growing rapidly from a small user base which investors hope will mirror the pattern we see in Norway.

I also added Finland which has been the market Plejd has struggled the most on and France which is a large country but a straggler in the smart home market. I don’t dare to draw too many conclusions from USA and UK as people may actually be named Shelly but at least we see Home Assistant growing.

So in summary, what we see is that the market for Home Automation is growing with Shelly having a very close correlation with the market in their home market Germany and a significant presence in many other countries.

 

Is there something going on in the trade receivables?

This is going to be very light because I do not have the time to compile the data myself and I think the results will never be other than inconclusive until we get further data. Therefore I used ChatGPT to do my dirty work. The point I focused on was that if we compare the criticism related to the Q4 conference call with the calculations provided online, the the conclusions will always be that the criticism is somewhat overstated but the data is worrying. Wolfgang actually highlighted the higher Days sales outstanding in his initial remarks so it was definitely not covered up. Furthermore, during a follow up question he described the process where they have been too generous with distributors adding a 30-60 day delay on top of the 60-90 day payment terms demanded by large chains like Hornbach and Bauhaus. So there being receivables outstanding for more than 90 days should not be a surprise even if the magnitude can be discussed. The revenue in Q4 2025 was 0.8 times the trade receivables vs 1.16 times in 2024 which is a significant increase. If this is attributable to a combination of changed distribution channels and higher sales we should see this trend stabilising or reversing during H1.

For completeness (and to see if anyone did a similar calculation) I also did this calculation with ChatGPT which may or may not be correct. As the shift in distribution channels provides no clear indication of foul play I will be monitoring this over time.

·         Days inventory outstanding (DIO) = 365 × average inventory / trailing-12-month COGS

·         Days sales outstanding (DSO) = 365 × average trade receivables / trailing-12-month revenue

·         Days payables outstanding (DPO) = 365 × average trade payables / trailing-12-month COGS

·         Cash conversion cycle (CCC) = DIO + DSO − DPO

 

Quarter	DIO	DSO	DPO	CCC
2022 Q4	103.5	86.1	8.8	180.7
2023 Q1	118.6	79.6	11.2	187
2023 Q2	132.8	76.8	18.3	191.3
2023 Q3	134.1	76.7	26.4	184.4
2023 Q4	114.3	76.3	28.5	162.1
2024 Q1	102.6	88.6	27.7	163.4
2024 Q2	98.1	99.2	23.8	173.5
2024 Q3	110.5	105	21.2	194.4
2024 Q4	132.7	102.2	22.2	212.7
2025 Q1	142	106	22.7	225.3
2025 Q2	148.4	110.6	24.5	234.6
2025 Q3	148.3	113.4	27.3	234.4
2025 Q4	124	116.6	27.9	212.7

 

Can we trust the management?

Shelly is still a small engineering led company. Dimitar Dimitrov reminds me of similar passionate fanatics like Robert Pera (Ubiquiti), Vlad Suglobov (G5 Entertainment) and Babak Esfahani (Plejd). In all of them I see very technically proficient leader who see an opportunity, aggressively pursue it and actively avoid being distracted from their main mission. This will from time to time frustrate investors but over time it becomes possible to see whatever they manage capital efficiently enough to create and build products with a superior customer experience.

For me, the pride and transparency Dimitar Dimitrov displays is a key factor when evaluating the company. That a CEO is sitting at a conference call and explains that the new camera will be downgraded from 256 Gb to 128 Gb due to cost increases to RAM says a lot about how he sees value creation in the company. It is technology and customer value that drives the company and which he think a shareholder should care about. Wolfgang Kirsch is a more typical CEO but him being willing to talk about his plans for selling some of the stock after his options have been vested was a surprise. As I see it, the constant stream of information that Shelly provides would make it very difficult for the co-CEOs to lie. I've followed several other investment stories like Fingerprint Cards and Intellego where it was apparent that the CEO adapted his message depending on what he thought was necessary to convince the market. Therefore I think the underlying basis for the receivables is simply that Shelly got enough working capital that they preferred being "generous" on terms over negotiating on price, which matches both the Conference Call and the now released "open questions" document on their website.

Portföljsammanfattning 2025

 2025 har varit ett år som gått ungefär som förväntat. Full fart i livet och en besvikelse gällande oljepriset som inneburit att oljeserviceinvesteringarna inte riktigt fått det utfall som jag hoppats på. Mina två största innehav har legat orörda men jag har rensat ut en hel del av de mindre bolagen. De stora förändringarna är att Shelly Group, Millicom och Fodelia tillkommit som innehav på bekostnad av Plejd, Cambi, Scandbook Holding och Nekkar.

Jag får särskilt tacka aktiebloggveteranerna Gilmour och Phantas som bidragit med uppdateringar och kunskap om Millicom respektive Shelly. Millicom var ett bolag som jag ägde för cirka tio år sedan och Shelly dök upp i mina konkurrentanalyser för Plejd. När jag tittade på dem fanns de bara tillgängliga på Sofiabörsen så det är två gamla bekanta bolag som jag annars hade tappat kontakten med utan Gilmour och Phantas skrivande. Fodelia kommer också från en gammal favoritbloggare (Snaljapen) och caset handlar i korthet om att tillverka mat för storkök mer effektivt samtidigt som man har problem med en mindre lönsam affärsverksamhet där finska chips är en viktig del. Jag har även gjort en mindre investering i I-tech där jag följt I-tech och utvecklingen av Selektope sporadiskt sedan 2010. I korthet handlar det om lönsam tillverkning av en komponent för bottenfärg som är väldigt gynnsam för minskad påväxt på fartygsskrov där en kombination av regulatorisk motvind i EU och kvartalsvisa variationer har ställt till det.

I diagrammet nedan är sträcken proportionella mot storleken på köp (över X-axeln) och sälj (under X-axeln vilket ger en överblick över mitt agerande under året.

Den stora förändringen utöver köp och sälj är att Reach Subsea tappat 13,3 % i börsvärde under året samtidigt som jag investerat en stor del av mina likvida medel. Sammantaget har det inneburit att Reach Subseas andel av portföljen minskat från 30 % till 20 % samtidigt som Odfjell Technology försvarat sin andel då börsvärdet ökat med 30 %, det blev även ett mindre köp i början på året då barnen fick Odfjell Technology aktier i julklapp för att lära sig mer om direktavkastning och aktier.

Avkastningen kan sammanfattas som rätt god med 16,7 % vilket slår alla mina jämförelseindex förutom Avanza Zero vilket avspeglar vilken typ av året det här har varit.

Tittar vi på avkastningen över tid är jag ganska nöjd med vad jag presterat. Jag tillhör inte eliten bland privatinvesterare men för att växla upp till den nivån skulle jag behöva investera avsevärt mycket mer tid och kraft än jag gör just nu. I takt med att portföljen växer blir det en allt mer rimlig prioritering men samtidigt har jag en forskarkarriär där jag just nu håller på att etablera min egen forskargrupp samtidigt som jag uppfostrar fler barn än jag har händer, så aktier är prio 3 i livet just nu. 

Ser vi till vad jag rent realistiskt kan åstadkomma är den viktigaste punkten återigen att bli bättre på att fånga upp bra idéer från andra. Man bör alltid ha koll på vad man investerar i men tittar vi på vilka tankar jag hade i min portföljsammanfattning förra året är den uppenbara missen att jag inte tog tag i Cheffelofrågan. Jag borde egentligen ha köpt aktien på rent kvantitativa argument redan när jag funderade på det men kombinationen av historisk uppgång och att jag inte är så förtjust i produkten innebar att jag missade en uppgång på ca 100 %, hade jag sedan bitit tag i det sura äpplet och köpt aktien då jag kunde konstatera att min fru inte vill leva livet utan att ha matkassa en vecka per månad så hade jag kunnat fånga åtminstone en kursdubbling. 

I övrigt kan jag konstatera att jag sålde Scandbook Holding lite för tidigt då de nu uppvärderats till P/E 10 (22 % upp sedan försäljningen i maj) och att Plejd fortfarande ligger 10 % högre än min försäljningskurs, däremot har icke-agerandet i SKAKO varit väldigt lönsamt. Även Maven Wireless har varit en rejäl jordfräs där jag lyckligtvis bara har en liten bevakningspost.

Tittar vi på vad som verkligen påverkat min portfölj har jag mina diagram för vinst, förlust och portföljpåverkan. Storleken på respektive tårtbit visar hur stor andel av vinst respektive förlust som varje innehav utgort under helåret (kursuppgång+utdelning/alla lönsamma affärer och vice versa) medan procenttalet i etiketten visar hur många procentenheter det påverkat portföljen. Det vill säga att portföljavkastningen varit 7,2 % om Odfjell Technology var mitt enda innehav som påverkat portföljen medan det för Reach Subsea (där något är fel i etiketten) hade en nettopåverkan på -2,1 %.

Inför nästa år är mina ambitioner extremt modesta, fokus ligger på jobb men jag hoppas räkna färdigt på I-Tech och Soiltech innan jobbet tar min uppmärksamhet under det första halvåret. När det gäller börsen är min enda stora förhoppning att världsekonomin inte brakar samman men om t.ex. AI-hypen kraschar tror jag att det blir en kollaps som påminner om E-handelsbubblan i början på 00-talet och då området komma att generera god avkastning i decennier efter att bubblan väl brustit och verkligheten börjar komma ikapp. 

Om man har det lite lugnt och tråkigt under julen kan jag även flagga för att jag skrivit en del ganska hyggliga blogginlägg under året. Analysen av Cambi kan vara värdefull om det blir en turnaround i orderläget (analys), utdelningsaristokrater har presterat bättre än vad jag trott (länk) och det är tur att jag inte investerade mer i Kanada för de casen har gått skit (länk). Under året skrev jag även en analys av Shellys marknadsposition som kan vara bra att läsa så att man inte stirrar sig blind på dimmers (analys).

Jag vill även passa på att tacka de personer jag umgås med på Discord, jag har inte riktigt ork med Twitter så Bluesky + Discord är en bra kompromiss och särskilt stort tack till Kamrat Tarmak som sköter mycket kring Enquest och Acornerection som sponsrade årets tävling där jag kom tvåa (jävla Axelsson och valutarörelserna...). Den vinsten kommer att gå till välgörande ändamål i Ukraina i syfte att minska antalet invasiva individer i de östra delarna av landet.