FYI | Nov 20 2018
By Pitt Street Research
Safety systems for the fast growing drones market
ParaZero Limited ((PRZ)) is an Israeli company that listed on the ASX in June 2018 to raise $5M in capital and to increase its visibility with international customers, distributors and channel partners. PRZ has developed and is commercializing proprietary UAV (Unmanned Aerial Vehicles) recovery systems, called SafeAir, to be mounted or integrated on commercial and consumer drones. These safety systems prevent drones from crashing in the event of critical malfunctions.
The drone revolution is here and now
PwC estimates that the value of businesses and labour displaced by commercial drones, e.g. for asset inspection, transportation, delivery of goods, law enforcement, filming and data capture, amounted to more than US$147bn in 2015. In other words, drones are already a big part of our everyday lives.
PRZ is a market leader in a very high-growth market as it has taken an holistic approach to drone safety systems. OEM contracts with companies such as Airobotics are testament to the quality of PRZ’s product offering. The large sales volumes expected in the consumer segment, combined with the high-margin professional drone market, are likely to provide a balanced revenue mix longer term.
Pitt Street Research has refrained from providing a full financial model, and hence a valuation range, given PRZ is still in the early stages of commercialization. but we will endeavour to publish a full model and valuation range when further sales materialize.
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