* New target EPS +75 pct 2016-2020
* CEO sees strong financial sector demand
* Shares up 9 pct, erasing YTD drop
STOCKHOLM, Dec 7 (Reuters) - Sweden's Intrum Justitia , Europe's biggest debt collector, lifted its shares on Thursday by confirming a preliminary profit growth target for the group formed by its acquisition of Norwegian peer Lindorff.
The enlarged group would aim for earnings per share (EPS)growth of at least 75 percent through 2020 to 35 crowns per share, matching an ambition presented a year ago when it unveiled the merger, Intrum Justitia said.
"It feels good to be able to confirm that picture and its a clear increase in growth pace compared with old Intrum Justitias EPS target," Chief Executive Mikael Ericson told Reuters ahead of a capital markets day in Stockholm.
Intrum, whose peers include Sweden's Hoist Finance and Italy's Cerved Information Solutions, said integration with Lindorff was on track and predicted annual cost synergies of around 580 million crowns. It lowered its synergy implementation costs forecast to around 725 million crowns from an earlier 1.0 billion.
In addition to organic growth within credit management services (CMS), Intrum says it also sees great scope to grow turnover from business process outsourcing (BPO) contracts, as well as from acquisitions in a fragmented market.
New targets announced by Intrum also include return on investment (ROI) of at least 13 percent, and a net debt/earnings before interest, tax, depreciation and amortisation (EBITDA) multiple of between 2.5 and 3.5.
Intrum's previous targets, from 2013, were for annual EPS growth of at least 10 percent, annual ROI of at least 15 percent, and net debt to EBITDA of 2.03.0 times.
Ericson said in an interview that Intrum is well placed to deliver on all its targets, helped by strong growth in most of its 24 markets, particularly a transforming financial sector.
He said the lower ROI target reflected interest rates drops since 2013, rather than a lowering of its ambition.
"We see that the risk in our portfolio has actually come down in the past few years," he added.
Shares in Intrum, which kept its dividend policy of distributing at least 50 percent of net profit, were up 10.3 percent at 1014 GMT, more than regaining a year-to-date drop. (Reporting by Anna Ringstrom; editing by Alexander Smith)