Ori­gi­nal-Re­se­arch: Must­Grow Bio­lo­gics Corp. (von GBC AG): BUY

Clas­si­fi­ca­ti­on of GBC AG to Must­Grow Bio­lo­gics Corp.

Bay­er Mi­le­stone Achie­ved – Strong Ter­ra­San­te De­mand Re­mains Sup­p­ly-Cons­trai­ned

Must­Gro­w’s equi­ty sto­ry re­mains cent­red on the com­mer­cial sca­ling of Ter­ra­San­te and the lon­ger-term va­lue po­ten­ti­al of its Bay­er part­ner­ship. The first Bay­er de­ve­lo­p­ment mi­le­stone re­sul­ted in C$1.36m of high-mar­gin li­cence re­ve­nue in H1 2026 and pro­vi­des im­portant ex­ter­nal va­li­da­ti­on of the Ter­raMG tech­no­lo­gy. Fur­ther up­si­de could ari­se from po­ten­ti­al ad­di­tio­nal mi­le­stone pay­ments as the pro­gram­me ad­van­ces. If com­mer­cial sa­les com­mence, Must­Grow would also be en­tit­led to royal­ties and re­ve­nue from ma­nu­fac­tu­ring sa­les.

Ter­ra­San­te sa­les were cons­trai­ned by ma­nu­fac­tu­ring de­lays ra­ther than in­suf­fi­ci­ent de­mand. The new pro­duc­tion li­nes in In­dia and Thai­land have not yet re­a­ched na­me­p­la­te ca­pa­ci­ty, re­sul­ting in li­mi­t­ed pro­duct avai­la­bi­li­ty. Nevert­hel­ess, sa­les re­a­ched ap­pro­xi­m­ate­ly C$0.90m by mid-Au­gust, around 46% abo­ve the le­vel achie­ved du­ring the who­le of 2025. Most vo­lu­mes were ge­ne­ra­ted from re­peat cus­to­mers, sup­port­ing the pro­duc­t’s com­mer­cial ac­cep­tance. The exis­ting fa­ci­li­ties of­fer esti­ma­ted an­nu­al re­ve­nue ca­pa­ci­ty of C$15m to C$25m once ful­ly ope­ra­tio­nal.

Due to the slower pro­duc­tion ramp-up, we re­du­ce our FY2026 re­ve­nue fo­re­cast from C$4.50m to C$3.50m and ex­pect EBITDA of C$-4.58m. We main­tain our re­ve­nue fo­re­casts of C$14.05m for FY2027 and C$31.56m for FY2028, as the short­fall is pri­ma­ri­ly re­la­ted to the ti­ming of pro­duct avai­la­bi­li­ty. EBITDA is fo­re­cast to im­pro­ve to C$-1.08m in FY2027 and C$8.46m in FY2028 as hig­her vo­lu­mes, lower freight cos­ts and ope­ra­ting le­vera­ge sup­port pro­fi­ta­bi­li­ty.

Ba­sed on our up­dated DCF mo­del, we re­du­ce our pri­ce tar­get to C$2.51 from C$2.70 due to the lower FY2026 fo­re­cast and the in­crease in the risk-free rate. The re­vi­sed tar­get pri­ce con­ti­nues to im­ply com­pel­ling up­si­de from the cur­rent tra­ding le­vel. We the­r­e­fo­re rei­te­ra­te our BUY ra­ting.

You can down­load the re­se­arch here: 20260924_MustGrow_Update

Cont­act for ques­ti­ons:
GBC AG
Hal­der­stra­ße 27
86150 Augs­burg
⁰⁸²¹⁄₂₄₁₁₃₃ 0
research@​gbc-​ag.​de
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Of­fen­le­gung mög­li­cher In­ter­es­sens­kon­flik­te nach § 85 WpHG und Art. 20 MAR Beim oben ana­ly­sier­ten Un­ter­neh­men ist fol­gen­der mög­li­cher In­ter­es­sen­kon­flikt ge­ge­ben: (5a, 11); Ei­nen Ka­ta­log mög­li­cher In­ter­es­sen­kon­flik­te fin­den Sie un­ter: http://​www​.gbc​-ag​.de/​d​e​/​O​f​f​e​n​l​e​g​ung
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Com­ple­ti­on: 24.09.2026 (14:30)
First dis­tri­bu­ti­on: 28.09.2026 (10:00)