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Analytikerkommentar

OmniCar: Pausing its online e-car sales platform

Av Michael FriisHead of Equities
OMNICAR

This morning, OmniCar announced a new partnership with XPENG Denmark to handle the service agreements and a new strategic decision pausing its online E-car sales platform following a strategic review. This implies that OmniCar has withdrawn the company's previous 2022 financial guidance. 

XPENG is expected to deliver the first vehicle in 2023, implying it will not have any financial impact in 2022. The deal highlights the potential for expanding the addressable markets with a bigger contract for services on other brands. With OmnicarService covering a big part of Denmark after expansion this year, this should be much more likely.

This announcement was followed by the announcement that the expansion of OmnicarSales (Online platform for E-cars) has been paused. Financially this lowers this year’s net profit loss and need for capital quite substantially, but also the expected revenue. Therefore, the 2022 guidance, which included significant revenues for this part of the business, is suspended. In the announcement, there is nothing about write-downs on the development cost for the OmnicarSales business.

Despite the fact that it lowers the upside in the share from a shareholder perspective, it could be worth noticing the following. Looking at financial markets right now, and how hard it is to attract financing, it could be very costly to finance the stock of cars. Thus, it makes sense to keep the momentum in the service business and focus on investments in this business segment. Currently, high-risk/high-reward business models with a long horizon to profit are low priced in this market.

In this context, it might make sense that we see a neutral share price reaction. However, the business case in the short to medium term is now much clearer.

OmniCar reports Q3 numbers on 31 November where we expect further details about the strategic decision as well as the partnership with XPENG Denmark. 

HC Andersen Capital receives payment from Omnicar Holding AB through a Digital IR/Corporate Visibility agreement. /Michael Friis, 31-10-2022, 10:36.

OmniCar Holding is a Danish company that offers a full-service auto repair shop, without the shop, by bringing certified mechanics to your door in vans (OCS). Supported by the OCS business and the ability to service and prepare used car for sales, the company is entering the online sales of used green cars by creating a platform where it is possible to buy, subscribe or lease your green car online, and get it delivered at your doorstep. As a result, OmniCar tries to cover the market from owning a car from cradle to grave by bundling the purchase and all the services that you need in a car’s lifetime such as financing, insurance, charging agreements, warranty, and road assistance.

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