Original-Research: IGEA Pharma N.V. - von GBC AG
Einstufung von GBC AG zu IGEA Pharma N.V.
Unternehmen: IGEA Pharma N.V.
Anlass der Studie: Research Report (Initial Coverage)
Kursziel: 1.05 EUR
Kursziel auf Sicht von: 31.12.2022
Letzte Ratingänderung: -
Analyst: Matthias Greiffenberger, Felix Haugg
Reverse IPO of Blue Sky Natural Resources in IGEA Pharma. Realignment to CBD extraction. Aggressive growth expected with strong scaling effects.
Blue Sky Natural Resources Ltd. (Blue Sky) was contributed to IGEA Pharma N.V. (IGEA Pharma) on 27 September 2021 via a capital increase in kind. The business model is now to change fundamentally. The wellness and prevention sector is to be addressed with a focus on CBD. The goal is to become the quality and cost leader in the field of CBD in Europe. To this end, a GMP pharma compliant plant is being built in Switzerland. The supercritical CO2 extraction process is to be used to achieve the highest standard of quality. A proprietary system has been developed for this purpose. Due to its very high quality, the product should be able to be sold at significantly higher prices compared to CBD obtained by using solvent-based methods. The marketing of CBD is to take place exclusively b2b in the wholesale trade. According to the management, the sales price can amount to about CHF 8,500 / kg. Based on this assumption, we forecast substantial sales and earnings developments.
According to the pro forma financial statements, no significant sales were generated in the past 2020 financial year, with a net result of EUR -2.23 million. According to the pro forma financial statements, the contribution created equity in the amount of EUR 9.06 million, which is largely offset by goodwill.
Blue Sky already has extensive quantities of raw material in stock. In total, there are 64,700 kg of frozen and 9,600 kg of dried hemp in stock. The hemp corresponds to the best organic quality (GMT). This is sufficient raw material for production in 2022. In 2021, samples will initially be produced in smaller machines and no significant sales revenues are expected yet.
The extensive production or CBD extraction is scheduled to start in 2022. Initially, this will be set up with one production line and one shift, and then expanded to a two-shift system. The production lines are then to be expanded to two in 2023, followed by three in 2024 and four in 2025. Bottling facilities will also be added to the production.
With raw materials already in stock, production should be able to start promptly and we expect revenues of EUR 51.05 m in 2022, followed by EUR 170.15 m in 2023. The business model is well scalable and we expect a gradual margin increase and earnings improvements. We already forecast EBITDA of EUR 23.12m in 2022 and EUR 88.23m in 2023, representing an EBITDA margin improvement from 45.3% (2022) to 51.9% (2023). Business operations are mainly conducted in the joint venture, in which IGEA indirectly holds a 50% interest. Minority interests are correspondingly high. In our opinion, 50% of the pre-tax result should flow to the joint venture partner. We therefore expect outflows for minorities of EUR -10,01 million in 2022 and EUR -42,12 million in 2023. It should be possible to use most of the loss carryforwards in IGEA Pharma to reduce the tax burden and we expect a tax rate of 10% in 2022 and 15% in 2023, resulting in net income of EUR 8.01m (2022) and EUR 28.45m (2023).
The CBD market is growing strongly and with the focus on quality leadership and pure extraction, IGEA Pharma's new business model should be able to occupy an attractive niche market. With the proprietary supercritical CO2- extraction technology, other markets such as vanilla, rose or rosemary can be developed in the medium term.
Based on our DCF model, we have determined a fair value of EUR 1.05 (CHF 1.13) per share and assign a BUY rating.
Die vollständige Analyse können Sie hier downloaden:
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Date and time of completion of the study: 19.11.2021 (11:00) Date and time of the first disclosure of the study: 22.11.2021 (10:00)
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