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

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 € 1.2m with an EBITDA of € -2.6m. This is a
significant decrease compared to the particularly strong Q4 last year with
roughly € 26m sales and € 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
€ 60-65 sales and € 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 € 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 € 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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