XTPL's Growth Journey: Advancing Product Commercialization and Scaling for the Future
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Advancing product commercialization and prospect of dynamic business scaling
We initiate coverage of XTPL with a Buy recommendation and a 12M target price of PLN 216
XTPL has exposure to the rapidly growing OLED display market, the advanced integrated circuit market and the advanced PCB market, among others. The company has completed the technology development phase and is now focusing on commercializing the offered solutions through the sale of DPS (Delta Printing System) devices and silver nanopaste. We expect that a surge in revenues can be guaranteed by industrial implementation of the offered technology.
The company is currently conducting nine industrial deployment projects, of which three projects are at an advanced stage. We expect the first industrial deployment to take place in 2024, and two more in 2025-26. In 2Q23, XTPL successfully conducted a share issue while securing funds for investments (estimated at PLN 60mn) needed to scale the business and achieve the targets set for 2026 (PLN 100mn in revenue).
Given the number of ongoing industrial deployment projects and the very good quality parameters of XTPL's technology compared to its competitors, we believe the company will be able to meet the revenue target set by management. Our forecasts assume a significant increase in the company's operating costs in 2024-26, which will be related to the intensification of activities aimed at commercializing XTPL technology.
