PeterHouse
Corporate Finance reports AVO has won nearly three quarters of all new
orders for proton beam installations worldwide in the past six months,
with eight of the 11 new installations and 24 of the 33 new treatment
rooms. It predicts AVO’s already big pipeline of orders will continue to
grow, with Letters of Intent to date covering eight installations at
about £26m for each installation.
Advanced Oncotherapy Plc (AVO) has announced Letters Of Intent (LOI) from 4 major organisations which require 8 of its LIGHT machines to be installed in initia sites in both the UK and US . This is very good news but what is really stunning is that these orders represent nearly three quarters of all the orders worldwide for Proton Beam Therapy machines placed in the last 6 months. Now MEDraysinte expects the world market for Proton Beam Therapy installations to triple over the next 5 years to 2018 and reach $2.5bn by 2030. We estimate that these orders are worth about £200m in total as the machines are installed over the next three years. As a result of this development, the risk with AVO has now shifted from development to delivery. If this dominant world market share is sustained in this rapidly growing market, then the present £10m valuation looks inappropriately low.
Related Files: 2013_10_02 AVO Analyst Note PH FINAL
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