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Capital raise of cEUR141m (gross amount) On July 13, Carbios announced the success of its capital increase. The final gross amount raised was cEUR141m. It resulted in the issue of 5.5m shares. 85% of the proceeds to fund the construction of a factory 85% of the net proceeds will be devoted to finance the construction of its first factory. It is expected to be commissioned in the course of 2025 with a nominal capacity of 50kT. The total cost of the factory is expected to be cEUR230m. The financing of this first plant will also be supported by Indorama Ventures (around EUR110m), subsidies from the French government (EUR30m) and from Grand-Est Region (EUR12.5m). 15% of the proceeds to boost RandD projects The rest of the net proceeds will finance expenses related to the PET RandD activities. They will also be used to set up research on other polymers (PA, PP and PE at a later stage) and/or further applications. Incorporating the capital increase into our forecasts We have adjusted our estimates to reflect the capital increase. We estimate net proceeds at EUR138m. Our net loss forecast for FY23e is reduced from -EUR35m to -EUR32m and for FY24e from -EUR24m to -EUR22m. Valuation range adjusted to EUR42 to EUR81 (vs EUR46.5 to EUR100 before) We update our valuation range following the capital increase and the issue of 5.5m shares. In the months to come we expect positive newsflow on: 1) further progress on the factory, 2) the set-up of new brand consortiums and 2) potential announcement of license contract agreements.
Carbios Carbios SA
Carbios is a cleantech company, focused on developing enzymatic bioprocesses for the recycling of plastic wastes and their biodegradation. Its technological lead and first-class ecosystem should encourage wide adoption as key milestones are crossed. Last week''s strategic update unveiled a more robust business model than initially expected. Our valuation range is lifted accordingly. Differentiated player in a highly competitive environment... Carbios'' technology overcomes mechanical recycling limits. Compared to other chemical recycling technologies, Carbios'' strengths are multiple: cleaner, faster, safer and easier. Fully patented, praised by the scientific community and endorsed by consortiums of first-class CPG companies that could well expand further, wide adoption should follow as key milestones are further reached. ... should allow company to charge premium royalties In addition to royalties on enzymes, revenues should now also encompass premium royalties. As such, the royalty contribution should increase from we believe cEUR60 per tonne to ''at least EUR250 per tonne,'' as guided by the company. This would offer a material boost to profitability. We therefore revise upward our estimates from 2026e, also as we include the contribution from the factory jointly owned with Indorama set to be commissioned by 2025e. Our forecasts for 2023-2025e are lowered on higher RandD and SGandA. We expect Carbios to be EBITDA positive by 2026e. Valuation range lifted to EUR51 to EUR110 (vs EUR28 to EUR54 previously) The pipeline of future licensing deals looks full, while the collaboration with Indorama is likely to meaningfully de-risk the scale-up. Our valuation range - which is derived from a DCF and two key inputs (royalties per tonne and capacity output) - is upgraded. Risks include access to and the price of PET waste, execution, competition and cash burn.
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