2006 - Taurus Track

Antonov is often compared with Torotrak by investors.
When discussing possible comparisons to Antonov it is difficult to avoid discussing Torotrak as these two companies are often compared by investors. We therefore provide a brief analysis of the significant differences between the two companies.

Torotrak
Torotrak has secured 2 production licences in the agricultural and construction vehicle sectors and a JV with a lawnmower manufacturer.

Torotrak floated in July 1998, raising over £50m in order to commercialise a new gearbox technology for the automotive industry: the infinitely variable drive using torodial frictional transmission technology. The company has, to date, secured two licensing contracts in the agricultural and construction vehicle sector and has entered into a joint venture with a US company to develop a lawnmower gearbox.

These applications are not addressing the mass markets.
We are cautious of the potential of these developments as agricultural and construction vehicles are not mass market and, in the lawnmower gearbox marketplace, there is already an adequate and cost effective solution: the hydrostatic drive. These developments do, however, show that the company is making some progress but it still seems far from its original aspirations which, like Antonov’s, are to penetrate the automotive transmission mass market.

Antonov should be valued at a premium to Torotrak.
In comparison, Antonov’s technology is cheaper, less complicated and less risky to automotive manufacturers and Antonov is already penetrating the automotive market. We therefore believe that Antonov should be valued at a premium to Torotrak and point to the current valuation differential between the two companies (Torotrak’s market capitalisation of £58million (at 49p per share) and EV of £56m compared with Antonov’s market cap of £37m (at 121.5p per share) and EV of £39m).