Original-Research: LION E-Mobility AG (von NuWays AG): Kaufen

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Original-Research: LION E-Mobility AG - from NuWays AG

Classification of NuWays AG to LION E-Mobility AG

Company Name: LION E-Mobility AG

ISIN: CH0560888270

Reason for the research: Update

Recommendation: Kaufen

from: 13.05.2024

Target price: EUR 7.00

Target price on sight of: 12 Monaten

Last rating change:

Analyst: Christian Sandherr

CMD underpins promising mid-term prospects; chg

Q1 sales came in at a mere EUR 1.2m with an EBITDA of EUR -2.6m. This is a

significant decrease compared to the particularly strong Q4 last year with

roughly EUR 26m sales and EUR 1m EBITDA. As pointed out during the earnings

call, this should mainly be driven by the seasonal distribution of the

company's current sales pipeline, which is seen to be similar to last

year's (H2 dependent). Management hence also confirmed its FY24 guidance of

EUR 60-65 sales and EUR 0.5-1m EBITDA. Importantly, the current fix cost base

should only slightly increase going forward (mainly due to ramping sales

efforts, i.e. growing sales headcount and trade shows), providing plenty of

room for operating leverage as sales increase.

Recent CMD confirmed the company's promising prospects as underpinned by a

mid-term guidance. Until the end of FY28e, management expects to grow sales

to more than EUR 150m, implying a sales CAGR of at least 25%, despite an

expected annual price decline of 9%. Mind you, its production site should

be capable of significantly higher sales (assuming three shifts a day).

As part of the mid-term guidance, LION re-aligned its sales efforts,

focusing on three key end markets, namely city buses in Europe (>8t),

electric trucks (light and medium duty) in Northern America and stationary

storage (uninterrupted power supply and industrial/commercial

applications). One of the key enablers, especially for the expected growth

within the storage market, should be the upcoming product update (planned

for H2), which will feature a LFP battery pack alongside a higher energy

density NMC pack (both enabled by the SVOLT partnership).

With its immersion cooled pack, LION would add hybrid/sports cars as fourth

end market. In fact, the project is developing as planned and LION expects

a first RFQ (request for quotations) until the end of the year. A positive

outcome would notably increase the likely hood of it becoming a notably

sales driver during the mid-term (currently not part of our revenue model).

Valuation remains attractive. Shares trade on roughly 0.5 EV/Sales FY24e,

which is notably below the industry's average of around 1x, while the

company is expected to show strong growth during the next few years.

We reduce our PT to EUR 7 (based on SOTP) per share but reiterate out BUY

rating.

You can download the research here:

http://www.more-ir.de/d/29709.pdf

For additional information visit our website

www.nuways-ag.com/research.

Contact for questions

NuWays AG - Equity Research

Web: www.nuways-ag.com

Email: research@nuways-ag.com

LinkedIn: https://www.linkedin.com/company/nuwaysag

Adresse: Mittelweg 16-17, 20148 Hamburg, Germany

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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse.

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The result of this research does not constitute investment advice

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