CyanConnode: Indian smart meter programme update

Hardman & Co
[shareaholic app="share_buttons" id_name="post_below_content"]

On 14 and 15 October 2022, the Indian Ministry of Power held a “Brainstorming Session” at the Power Ministers’ Conference. The presentation for the session contains a detailed update on the smart meter rollout in terms of rationale, targets and current progress. The Indian Government’s commitment to achieving the replacement of 250m meters remains emphatic, likely reinforced by the positive benefits delivered so far in terms of key metrics, such as billing and collection efficiency. Deployments of some 179m meters have been sanctioned, of which c.35% are at various stages of the tendering/award process. CyanConnode Holdings plc (LON:CYAN) remains a proven vendor and supplier to many prime contractors, boding well for the company.

  • Process is reaching the critical phases: After a lengthy gestation period and a couple of partial reboots, the Indian programme is gaining significant momentum, which is impressive given the unprecedented scale of the rollout of 250m smart meters across one of the most populous countries in the world.
  • CyanConnode is emerging as a key technology provider: Around 5m modules have been deployed so far, in total, in India, of which CyanConnode has delivered approximately 25%. It is, to date, the sole provider and/or primary vendor of smart meter connectivity technologies in several states across the country.
  • The total Indian programme value is immense: The total budgeted outlay for the smart meter element of the Indian programme is INR1.5 lakh crores, i.e. INR1.5tr, or around £15.8bn. A similar amount has been allocated to enabling activities such as expansion of distribution capacity and training.
  • Forecasts are conservative: Investors may perceive a disconnect between the growing momentum in the Indian programme and revenue growth forecasts, which anticipate 26% revenue growth in FY23. This is a function of the greater element of deferred revenue recognition, plus a highly conservative management approach.
  • Investment summary: The bias towards proven technology suppliers in the Indian programme is evident, especially for newer service provider participants looking to establish track records for successful deployments and positive reference sites. CyanConnode is benefiting from, and often working with, multiple partners in single tenders. Our DCF-implied fair equity value for CyanConnode is £63.7m (£0.27 per share), vs. the current market cap. of £31.9m.

DOWNLOAD THE FULL REPORT

Share on:
Twitter
LinkedIn
Facebook
Email
Reddit
Telegram
WhatsApp
Pocket
Find more news, interviews, share price & company profile here for:

John Cronin, CyanConnode CEO on AMISP contract win and strategic transition in India

CyanConnode's strategic shift to an AMISP model marks a pivotal moment in India's smart meter landscape. CEO John Cronin discusses the implications and benefits of this transformation.

CyanConnode Holdings $7.5M Middle East Loan Deal Sets Stage for Indian Smart Meter Expansion (Video)

With competitive lending terms and flexibility around equity conversion, this deal positions CyanConnode to accelerate project delivery without shareholder dilution

CyanConnode’s strategic leap into India’s smart metering revolution

CyanConnode landed a landmark contract to supply 6.5 million smart metering modules in India, bolstering its position in the growing energy market.

CyanConnode secures $7.5m convertible loan

CyanConnode secures a $7.5 million loan agreement to boost its smart metering initiatives, enhancing growth opportunities in India and beyond.

CyanConnode’s strategic shift signals new era of growth

CyanConnode is transforming the smart metering landscape with a £70 million contract for 750,000 meters in Goa and a new leadership team, driving global growth.

CyanConnode Secures £70m Smart Meter Deal with Goa Government as AMISP Strategy Pays Off (Video)

With improved margins, recurring revenues, and greater control through its AMISP model, CyanConnode is shifting into high gear

Search

Search