(Sharecast News) - Canaccord Genuity put its rating on engineering company Saietta 'under review' on Thursday following the publication of the group's full-year results.
Canaccord Genuity noted that revenue and grant income of £4.8mn was up 11% year-on-year, while adjusted underlying losses widened to £13.9m from £4.4m. Cash at the end of March was £7.2m.
Saietta also announced two further "substantial developments" at its Saietta VNA joint venture - one for an RFT e-drive system for at least 50,000 vehicles over five years and one for an RFT e-drive system, targeting 800,000 vehicles over five years.
The Canadian bank said that with the suspension and disposal of various non-core activities, Saietta had largely returned to its original IPO vision of being a UK-based technology company, with a "significant position in Indian two- and three-wheeler e-drive technology" and customers for its AFT e-drive systems being "largely on licence-and-royalty arrangements".
As a result, Canaccord made a number of changes to its model, notably ensuring Saietta VNA was "correctly treated" as a joint venture and not in underlying earnings, and updating forecasts to better reflect the group's cash requirements over the next 18 months.
"We note the group's statement about its requirement for additional funding in 4Q 2023 and to support further growth," said Canaccord. Given the uncertainty on funding and the pending lifting of the share suspension, we place our rating and target price under review (from 'buy', 80.0p target price)."
Reporting by Iain Gilbert at Sharecast.com
