Saietta (LSE:SED) stock hit the AIM market today. The electric motor maker targets a market cap of £102m on its first day of trading. But, this EV stock could go a lot higher if it realises its ambitious plans.
EV stock set to motor
Pancake shaped axial flux motors can be mounted on the wheel of an electric vehicle. They are efficient but expensive. Saietta has developed a patent-pending axial flux electric motor that it says can be mass-produced at a low cost.
Saietta’s AFT 140 motor is optimised for mid-power motorbikes and final mile delivery vehicles. Saietta sees the Asian market, in particular India, as the one to crack. Light motorbikes are already ubiquitous on the roads there. And, by 2030, 100m new motorbikes could hit the roads each year, and 40% of them are forecasted to be electric vehicles. These new electric motorbikes are what Saietta wants its motors to run.
A partnership with Padmini, an Indian automotive parts manufacturer, is part of Saietta’s plan to participate in the electrification of India’s motorcycles. It will be a manufacturing and distribution partner in India. The AFT 140 is tuned to operate in high ambient temperatures with heavy payloads over relatively short daily distances. The motor will be low voltage, allowing servicing by individuals untrained in high-voltage repairs. The high torque produced by the motor means no transmission, which reduces the overall price of the bike.
Getting electric motorbikes onto India’s roads requires new infrastructure. Thankfully, that is already on its way. Gogoro, a Taiwanese company, has already announced a partnership with a large two-wheeled vehicle manufacturer to bring its battery swapping refuelling platform to India. Home charging is, of course, an option, but a network of refuelling stations should help speed up electrification.
Saietta stock price
So, this is the Saietta stock story: it has a design for a potentially disruptive axial flux motor ideally suited to the demands of the light motorbike market in Asia, in particular, India, where it has a partner to help move its motors. There appears to be a growing market for electric motorbikes supported by infrastructure improvements and general trends. The company now wants to scale up production to establish itself as a low-cost manufacturer of electric motors for two-wheeled vehicles.
Now, how do the numbers look? Saietta raised gross proceeds of £37.5m in the run-up to today’s flotation. Part of that will pay for a UK durability testing (to reassure buyers of the motor’s longevity) facility. Most will go towards scaling up the UK based production to 100,000 units per year within three years. It has increased its revenues on limited production from £174,188 to £870,966 from 2020 to 2021. But apart from that, I do not know much.
I have not seen an IPO prospectus from Saietta. It has filed only balance sheets with Companies House. This is not uncommon for a new AIM stock, but it does leave me in the dark. As much as I like Saietta and its plans, I would like some more financial information before buying this EV stock for my Stocks and Shares ISA. In particular, I would want to see some pricing information. I will wait until I see it.
