Discover which companies are leading Serbia’s Law Firms market.

Following last week’s deep dive into Serbia’s furniture manufacturing sector, this week we shift our focus to the Legal Activities Sector (NACE 691). This industry plays a critical role in the country’s economy, with valuations primarily driven by revenue, while operational efficiency and profitability significantly impact financial stability. There were 6,807 active legal firms in Serbia, with total sector revenues of EUR 261mn in 2023.

Key Insights from Our Analysis

✅ Top Valuation Leader
Karanović & Partners leads the sector in valuation, backed by a strong revenue base. Its market presence and financial performance solidify its position as the industry leader.

✅ Revenue Growth
Schönherr (MVP) outperforms its peers in this sector, followed closely by Karanović & Partners. Positive outliers are Kinstellar (SOG) and JPM showing very high growth rates above 30% but a lower valuation.

✅ Profitability
The industry demonstrates a broad range of EBITDA margins, varying between 10% and 41%. This diversity highlights the different business models and operational efficiencies across firms in the sector. Positive outlier is Wolf Theiss with a margin ca. 41%.

✅ Positive Outliers
Schönherr (MVP) (ca. 39% EBITDA margin) and Karanović & Partners (ca. 28% EBITDA margin) emerge as standout performers, showcasing strong profitability relative to their peers.

✅ Negative Outlier
MSA IP reports a negative EBITDA margin of ~47%, making it a significant outlier. Despite maintaining a relatively high valuation, its operational inefficiencies present a financial challenge.

The Bigger Picture

Serbia’s legal services industry presents a diverse landscape of high-revenue leaders, high-margin firms, and financial outliers. While revenue remains the primary driver of valuations, growth potential and operational efficiency offer a more nuanced view of market performance.

Companies with strong financial fundamentals and efficient operations are well-positioned to thrive in this competitive market, while firms with high debt or weaker operational indicators may struggle despite high valuations.

Looking Ahead

This analysis is based on historical financial data from FY 2023. As the legal industry continues to evolve, market performance may shift based on changing demand, regulatory impacts, and economic factors.