Company Overview: ClearVue Technologies Ltd. is focused on development of specialty glass coating. The Company’s technology ClearVue PV is at its simplest energy efficient, clear glass windows which generate electricity and reduce energy consumption. Its technology allows visible light to pass through a pane of glass, while the invisible wavelengths of light are deflected to the edges of the glass where they are converted into electricity. Its technology also transforms a glass building into a solar panel, generating power where it is needed to reduce power transmission requirements. The Company provides energy-efficient glazing for commercial buildings, housing, greenhouses and automobiles, Internet of Things applications and mobile device screens.
 

CPV Details

Entry into New Markets– A Growth Catalyst: ClearVue Technologies Limited (ASX: CPV) is an Australian technology company which is engaged in Building Integrated Photovoltaic (or BPIV) sector that involves integration of the solar technology into the building surfaces, specifically glass and building façades, in order to provide renewable energy. The market capitalisation of the company stood at ~A$20.52 Mn as of 9 August 2019. The company recently provided cash flow and activities summary for June 2019 quarter wherein it highlighted that the group had made an entry in the new markets and also got listed on Frankfurt Stock Exchange as part of the larger strategy to increase the profile in the European region. On May 10, 2019, CPV updated the market on works which have been wrapped up on Warwick Grove Shopping Centre demonstrator site. After the company’s dual listing on Frankfurt Stock Exchange, it has made an appointment of Deutsche Gesellschaft fur Wertpapieranalyse Gmbh (or DGWA) as its investor relations advisor in Europe.


Net Cash Used in Operating Activities (Source: Company Reports)

As can be seen from the above image, the company’s net cash used in operating activities amounted to A$0.896 million in the quarter ended June 2019. During the same period, it has made payments amounting to $0.327 million towards administration, legal and corporate costs. It was added that a large focus for CPV in June 2019 quarter has been on taking further steps towards the market entry in the US. The company added that the A’19 Conference and Expo managed to attract one of the largest annual gatherings of architects and design professionals in the US. The Expo component was focused towards the introduction of the US and international architects and designers to the latest products and technologies in the construction. It was further added that the show has been a success for the company, and many new opportunities are being explored within the US.

Top 10 Shareholders: The following table provides a broader overview of the top 10 shareholders in ClearVue Technologies Limited:


Top 10 Shareholders (Source: Thomson Reuters)

Signing of MOU with BeyondPV: ClearVue Technologies Limited recently made an announcement that it has signed a memorandum of understanding (MOU) with BeyondPV Company, Ltd of Taiwan (R.O.C). Under terms of MOU and proposed formal OEM Supply Agreement, BeyondPV will design, manufacture, and supply solar PV strip modules to ClearVue and its licensed manufacturers from the dedicated production line to be used for ClearVue’s IGU (isolated glass units), windows and smart façades. BeyondPV would be providing ongoing R&D activities for the continuous improvement of ClearVue product and technology during OEM supply term.
Additionally, BeyondPV and ClearVue will be working cooperatively in order to maximize the solar strip shipments for ClearVue and its licensees project developments. The target of solar module strip shipment volumes in 2020 is to be over 200,000 strips.

Decent Liquidity Levels: In FY18, the company’s net margin has witnessed an improvement on a YoY basis, which reflects that its capabilities to convert its top-line into bottom-line has improved. Also, at the end of December 2018, the current ratio stood at 6.82x, which can be considered at respectable levels. The decent liquidity position provides sufficient headroom to the company for making deployments towards strategic business objectives.

Inked an Agreement with ARUP to develop its Smart Façade concepts: ClearVue Technologies Limited has made an announcement that it has inked a consultancy agreement with Arup Australia Pty Ltd. It was added that Arup’s façade engineering team which is led by Haico Scheepers (alongwith engineering staff and students from University of Sydney engaged through Arup) would be working with ClearVue on development of 4 design typologies of ClearVue Smart Façade concepts in a 5-month program (approximately). Under the consultancy agreement, all the intellectual property which is related to new façade design typologies is to be owned by CPV.

Appointment of European Communications Advisor: ClearVue Technologies Limited has made an announcement about the appointment of European investor relations advisors in support of the recent listing on Frankfurt Stock Exchange. Deutsche Gesellschaft für Wertpapieranalyse GmbH provides a number of investor relations services for the publicly traded companies, which include assisting in disseminating press releases, assisting in the increasing investor awareness amongst retail and institutional investment community, and assisting in the overall marketing of the company.

It would be providing investor relations services for an initial time span of 12 months, which could be extended by further 12 months upon the mutual agreement by parties, as well as could be cancelled by either party at the end of each six month period upon the prior notice of thirty days.

CPV Got First Order from Middle Eastern Distributor: CPV disclosed that it has received its first order from the licensed distributor in the United Arab Emirates, Grafsol General Trading LLC. Grafsol placed an order to the company for 100 square metres of ClearVue integrated glazing units (or IGU’s) involving order value amounting to USD $45,000 before duties, tax, insurance and shipping. It was also stated that the panels would be used in part of a new construction project within the UAE.

Key Takeaways from March 2019 Quarterly Report: CPV earlier provided the quarterly cash flow and activities summary for the time period ending March 31, 2019. On April 2, 2019 the company made an announcement about the delivery on its first commercial arm’s length sale to the third party, named GrowthPoint Properties Limited. On March 13, 2019, CPV made an announcement that it signed a new research agreement with Edith Cowan University (or ECU). Under terms of the agreement, ECU would be leading theoretical and experimental investigation of the micro-patterned clear thin film solar cells, and the methods for their fabrication which includes outdoor experiments and full prototype characterisation in the different weather conditions and for the product scaling. The following table provides a broader idea of the net cash used in operating activities:


Net Cash Used in Operating Activities (Source: Company Reports)

In the March 2019 quarter, the company’s net cash used in operating activities stood at A$0.629 million and, during the same period, the company made payments amounting to $0.306 million towards research and development while A$0.209 million was made towards administration, legal and corporate costs.

What to Expect from ClearVue Technologies Limited: At the end of June 30, 2019, ClearVue Technologies Limited had a cash balance of around A$1.4 million. Additionally, the company stated that there are expectations that it would be receiving an R&D tax refund in 2H of the year. The key personnel of the company stated that in the quarter ended June 2019, it was focusing towards preparing for as well as attending Las Vegas trade show and the US trip. Additionally, the company took numerous steps towards increasing the market awareness in Europe after listing on the Frankfurt Exchange, which includes preparing for awareness roadshow organized with the assistance of the European investor relations firm.

Coming to the key binding aspects of the MOU with BeyondPV, it was stated that BeyondPV will be investing USD $3.5 million (indicative) towards establishing the dedicated production line in order to produce ClearVue’s solar strip modules for ClearVue, for integration by CPV and its licensees into ClearVue IGU as well as smart façade products. The investment will be starting before December 2019. 

Stock Recommendation: The stock of ClearVue Technologies Limited has delivered the returns of -6.67% in the span of previous one month while, in the time frame of past six months, the company’s stock posted the return of -40%. As per ASX, the stock is presently trading towards its 52-week lower level of $0.170, proffering a decent opportunity for accumulation. On the other hand, the company has decent liquidity levels, which might help it making deployments towards key strategic objectives.

Additionally, the company’s revenues have been increasing since FY16 to FY18 and, therefore, it looks like the company is possessing decent capabilities to generate revenues which might help it in further improving the overall financial position. There are expectations that the company’s revenue generation capabilities together with the decent liquidity levels, might help the overall company to achieve long-term growth. Hence, considering the above-stated facts and the current trading levels, we give a “Speculative Buy” recommendation on the stock at the current market price of A$0.205 per share (down 2.381% on 9 August 2019).
 

CPV Daily Technical Chart (Source: Thomson Reuters)

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