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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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The issuer is solely responsible for the content of this research.

The result of this research does not constitute investment advice

or an invitation to conclude certain stock exchange transactions.

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