Cavendish has reaiterated its 'buy' on shares in Allergy Therapeutics PLC (AIM:AGY, OTC:AGYTF, FRA:HHU) pointing to early revenue growth and the start of commercial sales of the company’s newly approved grass pollen treatment in Germany.
In a note, the broker, which has a 13p price target, said the group had delivered a “highly encouraging” trading update for the six months to December 2025, particularly given the backdrop of its transition away from unregistered products in Germany.
Revenues for the period are expected to be £36.3m, compared with £34 million a year earlier, representing growth of 7% on a reported basis, or about 3% at constant currency.
Cavendish highlighted the regulatory approval in Germany of Grass MATA MPL, which will be marketed as Grassmuno, as the most notable development in the period.
The broker said the approval “has paved the way for the rollout of Grassmuno in Europe’s largest allergen immunotherapy market”, adding that commercialisation has now begun.
Management has previously said Grassmuno has the potential to achieve peak sales of €100 million in Germany alone.
The note said sales momentum from Grassmuno is expected to accelerate in the second half of the financial year. Cavendish added that a successful rollout “has the potential to steer the company towards self-sustaining profitability”.
The broker also pointed to balance sheet progress. Gross cash at the end of the period was £10.1 million, while the company used £55 million of the proceeds from the exercise of warrants held by shareholder lenders to repay all outstanding financial indebtedness.
Following the repayment, Allergy Therapeutics has put new financing arrangements in place, including a £50 million unsecured, uncommitted shareholder loan facility and access to a further £20 million uncommitted facility, giving total uncommitted funding of £70 million, Cavendish said.