Biotalys: Initiating Coverage: When AgTech meets ESG: shaping the future of sustainable and safe food supply

Today we initiate coverage on Biotalys with a Buy and € 8.7 Target Price in a company note titled “When AgTech meets ESG: shaping the future of sustainable and safe food supply”.

Biotalys is a green AgTech, Agricultural Technology, company that develops biological crop and food protection products based on a proprietary antibody-based technology shaping the future of sustainable and safe food supply.

We see significant market opportunities and growing importance of sustainable farming solutions.
We indicate that Biotalys’ AGROBODY Foundry platform technology offers significant advantages over the current generation of biologicals and conventional pesticides.
In the note we focus on the fact that Biotalys has a broad and diversified pipeline, with first registration dossier submitted and first market test expected in’22.
Biotalys has a flexible, capital light business.

We have valued Biotalys primarily using a detailed Sum-of-the-Parts model, which values each of the current pipeline products separately and the proprietary AGROBODY Foundry platform. In addition to the launch probability adjustments applied to all products (e.g. 50% in the discovery phase), we use a discount rate of 10% resulting in a Target Price of € 8.7 per share. As a result, we initiate coverage with a BUY rating. We included an extensive sensitivity analysis of the discount rate, gross margin variance, total addressable market growth and estimated market shares, resulting in a bear- and bull case valuation range for Biotalys of € 7.6 to € 9.8.