Broker note25 May 2023 20:11
Copied from ADVFN part 1 of 2
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Le Mass Du Pap25 May '23 - 16:09 - 1289 of 1290
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Shard Capital research note out today. Fair value £50m+ (~48pps+).
hxxps://shardcapital.com/capital-markets/corporate-broking/research-portal/#/portal/shard-capital
BSF Enterprise Plc Early Mover in UK Lab-grown Meat BSF Enterprise Plc (BSF) is a biotechnology company focused on acquiring, combining, and building businesses in the lab-grown tissue space. It aims to achieve this through an acquisitionled growth strategy and has already acquired the tissue engineering and cellular agriculture company, 3D Bio Tissues. Our fair value equity valuation of £50m+ for this business is based on the funding activity of similar companies, as well as the superiority of the company’s tech relative to these other players. The company has recently achieved a major milestone of producing the world’s first known piece of 100% lab-grown meat, requiring zero scaffolding for mimicking taste and texture of traditional meat. The company have also successfully produced a 10 by 10cm piece of bio-engineered animal skin, providing a direct path for breaking into the lab-grown leather market. In a positive endorsement of the Group, early users of its flagship product City-Mix have reported that they are already using smaller amounts of expensive growth factors to conduct their cell culture, a US$4 billion existing market which is expected to multiply alongside the rise in lab-grown meat. ► Scarce investment opportunity. BSF is one of only three listed companies in the world in the lab-grown Meat sector and the only one listed in the UK focused primarily on cell proliferation for both clinical use and human consumption. ► Market Growth. Lab-grown tissues have only recently begun to be used extensively beyond clinical cell growth. Like plant-based meat, the market for mass-produced cell culture is set to disrupt that of traditionally farmed meat, of which the latter has a current global market size of just under US$1 trillion in annual revenue. ► Animal welfare and the environment. Historically, the market for lab-grown meat has used Foetal Bovine Serum (FBS), an expensive undefined growth media derived from calf foetuses. Through its innovation in cell media, BSF is targeting animal welfare issues much more directly than competitors, along with the environmental impacts of traditional farming. ► Plant-based meat doesn’t make the cut. With the rise in living standards in developing countries, current forms of alternative proteins such as pea, soy, wheat, and mushrooms are not enough to significantly replace traditional meat farming. Sales growth for big plant-based players such as Beyond Meat in this market have curtailed since the initial boom in 20162018.
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