Canaccord Genuity raises target price on Invinity Energy

Analysts at Canaccord Genuity raised their target price on battery manufacturing company Invinity Energy Systems from 200.0p to 260.0p on Wednesday on the back of the group's recently awarded contract in South Australia.

On Tuesday, Invinity announced the award of a £6.7m contract to supply an eight megawatt-hour flow battery system to a solar photovoltaic power plant project, run by Yadlamalka Energy, set to be installed in the second half of 2021.

Canaccord highlighted that the contract roughly doubled Invinity's existing confirmed backlog, and meant that the company now had around 17mwh of contractual backlog to be executed in 2021.

In addition to that, Canaccord noted that there was approximately a further 7.0mwh for 2021 delivery expected to be awarded in the next few weeks, which means its projection of sales of 22-25mwh for 2021 was "almost fully derisked".

"We continue to see a very strong industrial backdrop for Invinity. Supply costs for renewable energy are continuing to fall, but this energy by its nature is non-dispatchable," said the analysts.

"At the same time there is a widespread recognition that storage is the best way to 'harden' intermittent renewables into dispatchable power, and that flow batteries offer a safe, high cycling, long-term value proposition in this market. This latest Yadlamalka project is a clear demonstration of this approach in Australia."

The Canadian bank also reiterated its 'speculative buy' rating on the stock.