Edison Group has today published its first report and valuation on VivoPower International PLC. The detailed analysis, being distributed globally to thousands of professional and private investors, values the business at $19 a share.
At market close Monday (March 29), VivoPower stock stood at $8.06.
At the core of Edison’s valuation is its view of the business’s accelerating growth strategy and “transformational” acquisition of rugged electric vehicle (EV) company Tembo. Having since announced a four-year deal – worth up to US$250 million – Edison concludes it makes Tembo the clear market leader, with enough volume to begin scaling. VivoPower has already committed to more than US$10m of additional funding for Tembo.
The report further concludes that the B Corp certification and potential admission into the MSCI World Sustainability Index is likely to endear the business to environmental-focused funds, as well as those with a broader ESG remit. VivoPower specializes in solutions for hard-to-decarbonize sectors and Edison’s report points to its strategy of building “an interconnected set of operations around the electrification of the economy” – including solar generation, microgrids, critical power provision and battery leasing.
According to the note: “As the company progresses so the risk profile and cost of capital will reduce which will support the valuation further.”
The Edison report also forecasts a rise in group revenue from US$49 million to US$133 million by 2023. The EV division is expected to account for over 55% of sales by 2023. The report anticipates a steady run rate EBITDA margin of 13%.
Edison identifies key markets for VivoPower in Canada and Australia, as well as pointing to its first scoping of a full corporate decarbonization solution with high-profile Premier League club Tottenham Hotspur in the UK. It finds that VivoPower’s development will be bolstered by the expansion of its energy management services, as well as its established Critical Power division, which is expected to account for 38% of revenue by 2023.
VivoPower’s business units are at varying points of their lifecycles, with each providing their own value to an integrated end to end holistic sustainable energy solution that will help corporate customers globally to accelerate their move to decarbonization.
Kevin Chin, Co-founder and Executive Chairman, VivoPower, added, “The Edison report recognizes the value our operations bring to supporting the decarbonization mission of corporations around the world. We’re part of a new generation of B Corps acting as the catalyst for change, marrying the need to decarbonize the future with solutions which fit current economic realities. We look forward to building on the momentum of our recent deals and acquisitions to scale our business and lead the way in providing sustainable technologies at a global scale.”
Neil Shah, Head of Research, Edison Group, said, “Edison Group is acutely aware that the shift from fossil fuels to sustainable energy solutions is a critical issue for the modern world, and VivoPower’s focus on decarbonization, particularly in hard-to-reach sectors, offers significant growth potential. We look forward to following its progress over the coming months.”
For more details of the up to US$250m Tembo deal, click here >
Watch the Tottenham Hotspur announcement here >
To explore VivoPower’s potential and mission, watch this video >
To read our full press release, and to keep up with all of VivoPower’s releases, visit our Press Releases page.