Company Overview: ClearVue Technologies Limited (ASX: CPV), which is an Australian technology company operating in the Building Integrated Photovoltaic (BPIV) sector which involves the integration of solar technology into diverse industries, was incorporated in 1995 as Tropiglas Pty Ltd and later was converted to an unlisted public company, Tropiglas Technologies Limited. The headquarter of the Company is situated in Perth, Western Australia and is being currently headed by Mr. Victor Rosenberg - the current Chairman and Managing Director. The group has developed a clear, energy harvesting window technology and advanced glass and glazing system which caters to demand from glass industry, Agriculture and horticulture sector, Commercial and residential sector, Public amenities, Mobile, wearables and internet of things (IoT) applications, and Motor vehicles sections. It is noteworthy that the Company’s technology is protected by 34 granted patents and by 39 patent applications throughout the world. The company has licensees for Australia, Japan, Singapore China, Europe & United States.


CPV Details

Commercialization to Drive the Growth: ClearVue Technologies Limited (ASX: CPV) is a small-cap company with the market capitalization of $30.41 Mn as of July 27, 2018. The company is currently realizing its product mix into the commercialization stage. While the Company’s research and development program is in progress, it is in the finalizing stage towards a commercial release of its initial core product. To enable commercialization, the Company has taken several steps to increase the production efficiency and capacity with its contract manufacturer i.e., Rocky in China. The final steps in preparing ClearVue’s products for commercial release relate to product quality testing and safety, and the certification for sale and installation of the products into different markets. Upon the listing on ASX, the company has engaged with at least two testing agencies or authorities in different global regions to progress this process. As of late, the company disclosed that it has now taken the next step on its commercialization path by confirming the certificate of its solar window technology to Australian Standard AS 2047 accreditation. With this, the company has now moved from being a research company into a commercial operating entity and is able to commercialize its product in the Australian market. We expect that the upcoming years will be transformative for the company in terms of commercialization and revenue generation with decent returns to shareholders.


ClearVue PV Applications (Source: Company Reports)

Well Diversified Business Model: The group has a robust business model. The company intends to derive revenue from three main sources i.e., licence, royalty payment, and sale & supply. In licences, the company earns revenue in term of charging a fee to manufacturers and distributors for the right to manufacture or distribute and sell the ClearVue product. In Royalty payment, the company intends to charge a flat royalty fee per square metre of ClearVue glass sold by a manufacturer or distributor business, with the rate to be determined. In Sale and Supply, the Company generates revenue from the assembled products directly sold to distributors and its channel licence partners across the globe. Besides this, the targeted customers for the group are primarily: the glass manufacturing industry, glass framing industry and the building and construction industry. However, the Company has not generated any revenue till date as they were in progressing stage. Quality is a primary parameter for the success of the business. So, the management has more focus on quality products to build consumers trust and that’s why it is continuously keeping its strength by doing product development & innovation in its R&D laboratory. The company product remains a market leading product. Hence, we expect that the company has a potential to grow in the long-run backed by the diversified revenue stream.


Revenue Model (Source: Company Reports)

Robust Growth Strategy – To Support Overall Growth of the Company: CPV’s strength lies in the unique product, innovation, and expanding footprint in the domestic and international markets. As of now, the group eyes on to set up a commercial-scale semi-automated manufacturing facility at its manufacturing contractor Qingdao Rocky Industry Co. Ltd. in Qingdao, China to achieve production economies of scale. Besides this, the group has completed the development and construction of 300 to 350 square metre greenhouse projects with the support of Apex Greenhouses and Edith Cowan University (ECU). The construction is anticipated to commence in the first half of FY18. Hence, we presumed that the company’s growth strategy will be underpinned by its’s commitment to ongoing technology and product development, which aims to maintain ClearVue’s technical position in the Building Integrated Photovoltaic (BIPV) space and continuously improve the performance of the Company’s product.

Highly Experienced Team: The company is loaded with the highly experienced management team and is being currently headed by Mr. Victor Rosenberg - the current Chairman and Managing Director. He has a rich exposure in senior management and sales related positions with a span of over 25 years of experience in sectors including the Pharmaceutical, Toiletries, and Food Manufacturing sectors. He has won an International Innovation Award in Germany for developments in food processing technologies. Moreover, he has been consulted by several private and public companies in the areas of pharmaceuticals, biotechnology, and health foods during his tenure. In June 2017, the Company framed an advisory board comprising of leading experts in the solar technology and building and construction industries with the objective to provide valuable strategic advice, along with industry insights and contacts to the Company during its intended commercialization and growth phase.


Board and Management (Source: Company Reports)

Synergistic Agreements with World Class Technology Partners for Overall Growth: Tie-up with Nanyang Technology University (Singapore), Singapore HUJ Alliance, and Chinese glass manufacturer company i.e., Rocky will support the overall growth of the company in the forthcoming period with further opportunities in the domestic and international market via collaborations. This is expected to find support from increasing strength of its solar printing technology.


World Class Technology Partners (Source: Company Reports)

Financial Highlights: During FY17, the revenue and other income recorded $62,922 from nil in the previous year. However, loss after income tax expense amounted to $ 718,955 in FY17, up from $ 550,272 in FY16 at the back of higher administrative expense and finance cost during the same period.  As on 30 June 17, the Group had consolidated total assets of $ 2,325,060(FY16: $ 1,412,720) with the cash balance of $ 509,789 from cash reserve of $ 176,368 in FY16. In May 2018, the company raised $ 5 Mn through initial public offer (IPO). The main objective of this fund was to commercialize Company’s technology in accordance with the business model and growth strategy. The current ratio stood at 2.08x which is above the industry median (1.34x). At present, the company has a decent cash position with zero debt facility. No dividends were proposed or paid during the period.


FY17 Financial Highlights (Source: Company Reports)

Positive Outlook: We are optimistic on the company as it has a mission to use the energy through innovative building materials by offering a powerful renewable energy solution that incorporates solar energy generation into transparent glass. ClearVue in collaboration with CENER will explore testing and certification of ClearVue’s technology, which will provide an input for the product development of ClearVue’s components. On the other hand, the company received AS 2047 accreditation for e ClearVue window product from the Australian Window Association (AWA) which represents a giant leap forward for the company. The group has also reported for completion of testing and certification to European Standard EN 14351-1:2006+A2:2016 with regards to its solar window allowing for ClearVue window products to be sold in the European Union and this is the mandatory minimum specification for windows and doors sold and used in the EU.

Stock Performance: The company has already received strong product interests from around the world in the building & construction, agriculture, and public amenities industries. It has also received strong interest in manufacturer/fabricator partnership from various regions such as Australia, Asia, Europe & MENA. Hence, we expect that the company has strong growth potential in years to come post commercialization milestones. The projected revenue drivers are Building & Construction and Agriculture External Applications. Meanwhile, Mr. Ian Rosenberg and Mr. Victor Rosenberg became the substantial holder of the Group since 25 May 2018 and held 9,230,081 & 22,660,099 securities with 9.71 per cent & 23.84 per cent, respectively of the voting power. The share price climbed up 52.38 per cent since listing on ASX and by 166.67 per cent in the past one month as on July 26, 2018. While the share price slipped by 7.25 per cent in the past one week. Hence, we give a “Speculative buy” recommendation on the stock at the current market price of $ 0.335 (up 4.688% on July 27, 2018) considering the current trading level and growth opportunities across its business in the upcoming period.
 

CPV Daily Chart (Source: Thomson Reuters)

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