Checked out SA water. They are run by the SA government and service a population of 1.6 million people. They have 10 desalination plants of which 2 are sea water. They have 8700 kilometres of sewage pipes to maintain and multiple water treatment plants. Looks like EVS water is going to be a slow build initially until the technology is more widely adopted over time. SAM is $2.8 billion. Meantime the serviceable addressable market for OMNIS is $1.4 billion. Plenty of time for EVS water to catch on meantime OMNIS is doing the heavy lifting and set to accelerate with the SGS agreement. Even if EVS only managed to pick up 10% of both combined SAM markets in ARR, then you’re still talking $420 million in ARR between OMNIS and EVS water. This company has extraordinary growth potential in the coming years and potentially could become a behemoth in years to come. Would not surprise me in the slightest as it creeps towards break even if it becomes a TO target given it has no debt and potentially becomes a cash cow for another company. Not sure how EVS would be able to defend that position unless they start borrowing funds and accumulating defensive debt as they move towards profitability. Would be a great pity if they get swallowed up by a suitor in 12 months time before getting an opportunity to demonstrate to the market just how big this company could become. At a conservative 30 times earnings that is an eye watering MC for an Australian company….
EVS Price at posting:
12.5¢ Sentiment: Buy Disclosure: Held
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