Equity Research Lokotech: Financing and framework agreements secured

Lokotech AS (“Lokotech” or the “Company”) announced on Monday, March 3, that it has secured financing for the mass production of Hashblade through a partially guaranteed rights issue of up to SEK 200 million. Since December 2024, the Company has announced two important framework agreements for delivery of Hashblade, with a potential value of USD 6–12 million. Carlsquare Equity Research raises its motivated fair value to NOK 3.1 (2.1) per share.

NOK 125 million secured through rights issue

Lokotech announced on Monday, March 3, 2025, that it is carrying out a partially secured rights issue of NOK 200 million to ensure financing for the mass production of Hashblade. The rights issue is secured up to 62.5%, corresponding to NOK 125 million. The rights issue, expected to take place between May 7–21, 2025, is subject to approval at an extraordinary general meeting on April 30, 2025. Given the Company’s ownership structure, we see the approval at the extraordinary general meeting as a mere formality.

The subscription price will be based on the TERP price, calculated from the volume-weighted average price (VWAP) three days before the extraordinary general meeting, with a 35% discount applied. Furthermore, subscribers in the rights issue will receive subscription warrants that can be exercised from April 1 to April 15, 2026.

Important framework agreements expected to increase revenues

In our research report from December 2024, we accounted for the risk associated with financing the mass production of Hashblade, given that the Company needed a minimum of NOK 80 – 120 million to secure large-scale production. The financing risk is now eliminated, which changes our view of the case. With secured funding, Lokotech can now fully focus on the commercialization of Hashblade.

In early December, the Company announced that a framework agreement for a large pre-order of Hashblades with a U.S.-based entity had been signed. The agreement is reported to be in the range of USD 2–5 million. In early February 2025, Lokotech announced that another framework agreement for a pre-order of Hashblades had been signed. The total revenue potential from these agreements amounts to approximately USD 6–12 million, with additional revenue opportunities, such as “hosting” parts of the order, which could generate further income for Lokotech.

Valuation upside given shift from R&D to commercialization

Given the developments in financing for the mass production of Hashblade, as well as the important framework agreements, we have adjusted our revenue estimates and revised the discount rate to reflect the new conditions.

Combining a DCF model with a multiple valuation, we calculate a fair value of NOK 3.1 per share. That corresponds to an EV/Sales 2027 of 3.3x and EV/EBITDA 2027 of 15.0x. The peer group trades at a median EV/Sales NTM of 3.6x and EV/EBITDA NTM of 12.5x.

Disclaimer

Carlsquare AB. www.carlsquare.se, hereafter referred to as Carlsquare, conducts operations in Corporate Finance and Equity Research and thereby publishes information about companies, including analyses. The information has been compiled from sources that Carlsquare considers reliable. However, Carlsquare cannot guarantee the accuracy of the information. Nothing written in the analysis should be regarded as a recommendation or invitation to invest in any financial instrument, option or similar. Opinions and conclusions expressed in the analysis are intended solely for the recipient.

The content may not be copied, reproduced, or distributed to any other person without the written consent of Carlsquare. Carlsquare shall not be liable for any direct or indirect damage caused by decisions made based on information contained in this analysis. Investments in financial instruments provide opportunities for capital appreciation and profits. All such investments are also associated with risks. The risks vary between different types of financial instruments and combinations thereof. Historical returns should not be considered as an indication of future returns.

The research is not directed at U.S. Persons (as that term is defined in Regulation S of the United States Securities Act and interpreted in the United States Investment Companies Act 1940) and may not be distributed to such persons. Nor is the analysis aimed at such natural or legal persons where the distribution of the analysis to such persons would involve or entail a risk of violation of Swedish or foreign law or regulations.

The analysis is a so-called commissioned analysis where the analysed company has signed an agreement with Carlsquare for analysis coverage. The analyses are published continuously during the contract period and against customary fixed remuneration.

Carlsquare may or may not have a financial interest in the subject of this analysis. Carlsquare values ensuring objectivity and independence and has therefore established procedures for managing conflicts of interest.

The analysts Christopher Solbakke and Herman Kuntscher do not and may not own shares in the analysed company.