logo-loader

VSA Capital Market Movers - Invinity Energy Systems

In April 2020, US-based Avalon Battery merged with AIM-listed redT energy (LON:RED) to create Invinity Energy Systems plc (IES LN). An equity fund raising of £8.0m was also undertaken for the new combined entity. With a highly experienced team, worldwide sales reach, a secure supply chain and low-cost manufacturing facilities

Capital Limited - VSA Capital Market Movers - Invinity Energy Systems

Invinity Energy Systems#: Power On

Successful Merger

In April 2020, US-based Avalon Battery merged with AIM-listed redT energy (LON:RED) to create Invinity Energy Systems plc (IES LN). An equity fund raising of £8.0m was also undertaken for the new combined entity. With a highly experienced team, worldwide sales reach, a secure supply chain and low-cost manufacturing facilities, Invinity Energy Systems plc (“Invinity”) will seek to achieve real scale in battery storage markets for utility, industrial and commercial applications.

Growth Opportunity

The £8.0m raised through the issue of new shares was to fund development of Invinity including investment in R&D, marketing and also working capital to increase volume to meet an identified project pipeline of just over 4,000 units (circa 161MWh). We estimate unit volumes to rise to 1,250 in 2021 and 3,200 in 2022, driving revenues of £21.2m and £52.2m. 

Breadth of Applications

The Invinity Vanadium Redox Flow Battery (VRFB) has been designed to provide a standardised module that can be produced in high volume. There are already over 160 in use. Recent business wins, announced in the Invinity June 2020 Trading Update, reflect breadth of markets with orders secured from a global retailer, U.S. municipal utility and leading Asia-based energy storage project developer.   

Recommendation and Target Price

Our peer group analysis supporting a DCF valuation sets an indicative valuation range of £180m-£200m which implies 255p-283p/sh. versus the current price of 119p (£84.1m). If Invinity achieve our 2022 forecasts and therefore scale, the future valuation could become substantially higher. 

We initiate coverage with a Buy recommendation and Target Price of 269p/sh.

Phil Smith, Equity Analyst, Alternative Energy | T: +44 (0)20 3617 5187 | E: [email protected]

VSA Capital Limited, New Liverpool House, 15-17 Eldon Street, London EC2M 7LD | www.vsacapital.com

This email is intended solely for the named recipient. It may contain privileged and/or confidential information. If you are not one of the intended recipients, please notify the sender immediately, and destroy this email: any disclosure, copying to any person or any action taken or omitted to be taken in reliance on this e-mail, is prohibited and may be unlawful. Any views expressed in this message are those of the individual sender, except where specifically stated to be the view of VSA Capital Limited, its subsidiaries or associates. Whilst all efforts are made to safeguard inbound and outbound emails, VSA Capital Limited and its subsidiaries or associates cannot guarantee that attachments are virus-free or compatible with your systems and do not accept any liability in respect of viruses or computer problems experienced.

VSA Capital Limited will use your personal information to administer your account in order to provide any products and services you have requested from us. Your personal information will be kept secure and will not be shared with any other party unless you provide consent to that effect.

VSA Capital Limited is Authorised and Regulated by the Financial Conduct Authority and is a member of the London Stock Exchange.
The Company is registered in England with company number 2405923 at New Liverpool House, 15-17 Eldon Street, London EC2M 7LD.

Please consider the environment before printing this e-mail

unsubscribe from this list    update subscription preferences 

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

In exchange for publishing services rendered by the Company on behalf of Capital Limited named herein, including the promotion by the Company of Capital Limited in any Content on the Site, the Company receives from...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Jubilee Metals CEO welcomes 54% growth in first half operational earnings

Jubilee Metals Group PLC's (LON:JLP) Leon Coetzer caught up with Proactive London's Andrew Scott after reporting its sixth consecutive six-monthly period of double digit growth - posting a 54% increase in first-half earnings to £12.8mln. The company was also able to boost revenue by 18% to...

2 hours, 9 minutes ago

3 min read