Original-Research: Noctiluca S.A. (von East Value Research GmbH ):

Original-Research: Noctiluca S.A. - from East Value Research GmbH

Classification of East Value Research GmbH to Noctiluca S.A.

Company Name: Noctiluca S.A.
ISIN: PLNCTLC00018

Reason for the research: Update
from: 20.05.2024
Target price: PLN 208.90
Target price on sight of: 12-months
Last rating change:
Analyst: Mateusz Pudlo

Noctiluca (NCL) continues to make progress in terms of both revenues from proprietary materials and the number of commercialised patented families of chemicals compounds. According to management, these are two key elements in building value for companies like Noctiluca. To date, the company has 4 patent applications, with one patent granted. NCL is becoming a recognised company in the display industry, allowing it to convert its Material Testing Agreements (MTAs) into paid contracts. Important Joint Development Projects (JDPs) with two leading display companies in Korea are still scheduled to start in H2/2024E. In addition, Noctiluca is now going one step further from being a pure chemical company and plans to develop a complete OLED stack with its Taiwanese partner in order to create turnkey solutions for its customers. Noctiluca aims to be the first company in the world to have a complete printed electronics (IJP) offering by 2024E. The last few months have brought a lot of good news for the OLED industry, including news of Apple's planned full implementation of OLEDs in its tablets and laptops. Taking into account the positive development of the IP portfolio as well as the development of the OLED industry as a whole, we maintain our valuation of Noctiluca at USD 81.75m (PLN 325.37m / PLN 208.90 per share), which implies an upside of 97.4%.

In Q1/2024, Noctiluca largely completed orders from 2023, resulting in sales of materials of PLN 272k (Q1/23: PLN 2k). Operating expenses increased by +95.7% y-o-y to PLN 2.45m, resulting in EBITDA of PLN -1.33m (Q1/23: PLN -1.08m) and a net income of PLN -1.81m (PLN -1.19m). At the end of Q1/2024, NCL had only PLN 519k in cash, but thanks to a financing agreement for a loan of up to PLN 6m with Rubicon Partners (major shareholder of Synthex Technologies), the financial stability is ensured until the expected share issue in H2/2024E.

For the full year 2024E, we have lowered our revenue estimates to PLN 4.05m (prev. PLN 4.67m), as our decision is motivated by the postponement of three JDP to 2025E. We now forecast an EBIT of PLN -5.22m (previously: PLN -4.6m) and a net profit of PLN -5.19m (PLN -4.57m).

You can download the research here:
http://www.more-ir.de/d/29821.pdf
For additional information visit our website https://eastvalueresearch.com/.

Contact for questions
Adrian Kowollik
Email: ak@eastvalueresearch.com
Tel. +49 30 20609082

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