EQTEC – Valuation Update

Raises £16 million to accelerate commercial opportunities. Trading update confirms progress in Q2. Forecasts and target price raised

EQTEC provides project development, engineering and design services – with its leading-edge Advanced Gasification Technology at the centre of sustainable waste-to-value plants – to operators and investors. EQTEC’s solutions produce a pure high-quality synthesis gas (syngas), capable of being used for the widest applications including generating green electricity, heat, biofuels and hydrogen. The company works with and co-ordinates multiple parties for its projects, including developers, waste owners, EPCs and contractors and funders with a view to ultimately providing its gasification technology, associated engineering & design services and O&M services.

  • Total £16 million raised in May in over-subscribed placing

    The money was raised at 1.5p per share, an 11.24% discount to the previous day’s closing price. As our previous updates have highlighted, EQTEC has over the past few months developed a significant pipeline of projects. Between July 2020 and February 2021, non-contracted tender opportunities worth a total potential of €316 million were added for a total potential pipeline value of €657 million. With this in mind, the company will use the proceeds of the fund raise to take full advantage of a number of near-term opportunities and to prepare itself for further long-term growth.

  • Q2 trading update confirmed that progress continues in 2021

    A July trading update confirmed that EQTEC has continued to make progress across its pipeline of opportunities in the three months to end-June. The company also confirmed that it is on track to meet its target of achieving c.€15 million of revenues for 2021 and a maiden year of profitability. This assumes that revenues are weighted towards the second half of the year as deals reach financial close and fees are received.

  • Forecasts revised to consider pipeline acceleration & target price raised

    Following the fundraise we have revised our expectations for the 2021 to 2023 financial years and used these as a basis for providing a valuation for the company. In 2023, as more projects are progressed and the substantial non-contracted pipeline is translated into commercial success, we are now looking for revenues to more than double to €149.3 million (up from €118.5 million previously) and EBITDA to grow by 142% to €36.6 million. Using our updated 2023 forecasts, and on an EV/EBITDA multiple basis discounted back to end 2021, we derive a new target price of 3.47p per share. Conviction Buy.


    EQTEC is a research client of Align Research. Align Research own shares in EQTEC. Full details of our Company & Personal Account Dealing Policy can be found on our website http://www.alignresearch.co.uk/legal/ 

    For full disclaimer information please refer to the last page of the full document. This investment may not be suitable for your personal circumstances. If you are in any doubt as to its suitability you should seek professional advice. This note does not constitute advice and your capital is at risk. This is a marketing communication and cannot be considered independent research.

Table: financial overview
Year to Dec 2021E 2022E 2023E
Revenues (€) 15.5 63.1 149.3
EBITDA (€) 3.46 15.5 36.6
EPS (p) 0.041 0.136 0.322
Source: Align Research