The stockbroker, in a note, highlighted that Monday’s equity funding is a strong signal that the market has recognised the importance of commercial milestones achieved by the hydrogen fuel cell technologies.
AFC Energy this morning raised £1.4mln of new capital to boost financial liquidity so that the business is protected in the event of a prolonged coronavirus (Covid-19) pandemic.
It is the latest subscription from the existing institutional shareholder which was the sole participant and it is subscribing for 14mln new shares, priced at 0.1p each. The price is marked at an 18.7% discount to Friday’s closing price in London.
The funding comes after AFC last week unveiled several measures designed to help mitigate the impact of the coronavirus outbreak.
WH Ireland analyst Brendan Long, in a note, described the company as being “on a positive trajectory” supported by equity funding.
The stockbroker has a 27p per share fair value estimate for the London AIM-listed share, reflecting significant potential upside to the current market price of 12.13p.
“We believe all three of the fundraises announced by AFC Energy this year, and particularly the most recent fundraise, provide strong indications that the equity market has recognised the importance of the commercial milestones made by AFC Energy in respect of the H-Power product, which places the company convincingly on positive trajectory,” Long said.
“Whilst commercialisation of the H-Power emissions-free hydrogen or ammonia fuelled EV charging system is progressed, behind the scenes it is also important that the AlkaMem membrane is being further advanced and we note that the uncertainty created by COVID-19 should have little impact on that progress.”