Canaccord Genuity slashes target price on Saietta

Analysts at Canaccord Genuity slashed their target price on engineering firm Saietta from 285.0p to 120.0p on Tuesday following the group's operational and trading update earlier in the day.

Canaccord Genuity noted that that Saietta's update highlighted its progress with its Indian joint venture and customers, including two major original equipment manufacturer programs, and the refocus of its strategy onto fully funding itself from its existing activity.

While the group now expects no need for external fundraising for the coming financial year, it warned on the rest of the business, with its heavy-duty wing, including ConMet, running "much more slowly than previously indicated", and its Propel marine operation struggling with key component availability and consequent revenue generation.

"We are making material downgrades to our near-term expectations, reflecting the pushing to the right of the ConMet transaction and Propel," said Saietta, which reiterated its 'buy' rating on the stock.

"The positive in the release is that the remaining revenue forecast is now with a high degree of certainty and the scale of the market opportunity is unchanged; we continue to see very rapid take-up of EV mobility in India, and market opportunity in e-drive solutions."

Reporting by Iain Gilbert at Sharecast.com