We believe UTR has the building blocks in place to become a leading-edge supplier of anode materials through IP licensing and/or joint manufacturing of anode materials, to be used in the future manufacture of Lithium-ion anodes. Due to superior performance characteristics of TiO2 nanotube anodes and price differential with graphite anodes, we believe the technology will be very well suited to high-end applications, such as EV batteries and premium smart phones, in particular.
Additionally, through acquisitions and licensing of complementary technologies, such as IP around LMNO cathode materials, we believe UTR can deliver complete battery solutions, for instance for the fast-growing EV market.
In terms of valuation, we believe VC-funded emerging battery technology companies provide a good gauge of valuations the market is willing to pay for promising companies, with toreDot being highly comparable to UTR.
UTR’s key challenge in the near to medium term will be to generate and subsequently convert industry interest in its TiO2 Nanotube anode materials. If and when successful, we believe there will be substantial upside to the company’s valuation.
Hence, we start our coverage of UTR with a BUY rating and a price target of A$ 0.09 per share.
Near term share price drivers:
- MOU’s and /or commercial IP deals with suppliers to the Lithium-ion battery industry as well as to battery manufacturers directly will support the business case.
- The production scale-up of TiO2 nanotube test materials will enable UTR to have more prospects test the technology, which would expedite the commercial roll out. We expect news flow around volume scale-up in the next several months.
- A joint venture agreement with one of the large TiO2 manufacturers, to potentially start joint nanotube manufacturing, is actively being pursued by UTR.
UTR Price at posting:
3.4¢ Sentiment: Buy Disclosure: Held
