Section1: Company Overview and Fundamental Insights:

1.1 Company Overview:

NanoXplore Inc (TSX: GRA) is a graphene company, manufacturer, and supplier of high-volume graphene powder for use in industrial markets. The company provides graphene-enhanced plastic and composite products to various customers in transportation, packaging, electronics, and other industrial sectors. Geographically, it generates a majority of revenue from the United States. Kalkine’s Penny Report covers the Investment Highlights, Key Financial Metrics, Risks, Technical Analysis along with the Valuation, Target Price, and Recommendation on the stock.

1.2 The Key Positives, Negatives, Investment Highlights and Risks

1.3 Top 10 Shareholders:

The top 10 shareholders together form ~42.35% of the total shareholding. Martinrea International Inc and Caisse de Depot et Placement du Quebec hold a maximum stake in the company at ~­­­22.71% and ~6.68%, respectively.

1.4 Key Metrics:

The company reported decent revenue growth in Q3 2023 compared to the same period last year, which is a key positive. Additionally, the group’s liquidity ratios have outperformed the industry median numbers, another significant plus. Furthermore, the company is sequentially improving the health of its debt-to-equity ratio, demonstrating the resilience of the company.

Section 2: Business Updates and Financial Highlights

2.1 Recent Updates: The below picture gives an overview of the company’s recent activities, such as the announcement regarding a 100% equity stake in Volta Xplore and minimizing its long-term debt.

2.2 Insights on Q3 2023 Financial Performance:

Section 3: Key Risks and Company Outlook

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

The stock has witnessed a downside of ~9.53% in 1 month and ~10.71% over the last 3 months respectively. Moreover, the stock is trading below the average of 52-week high price of CAD 5.00 and 52-week low price of CAD 2.05 providing an accumulation opportunity. NanoXplore Inc (TSX: GRA) was last covered in a report dated ‘26^th April 2023’.

4.2 Fundamental Valuation

Valuation Methodology: EV to Sales Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is May 16, 2023. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

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Disclaimer

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