LONDON, Feb 15, 2024 – Zapp Electric Vehicles Group Limited (NASDAQ:ZAPP), a British electric vehicle brand, announced today it has secured $1.5 million in funding through a standby equity purchase agreement with an affiliate of Yorkville Advisors Global, LP. This funding injection marks a significant step forward for Zapp as it gears up to roll out its highly anticipated i300 electric motorcycle across Europe.
Empowering the Electric Revolution
Swin Chatsuwan, Founder and CEO of Zapp, expressed enthusiasm about the funding agreement, emphasizing its importance in kickstarting the production and commercialization of the i300. The initial $1.5 million will fuel the launch of the i300, a groundbreaking electric motorcycle designed to revolutionize urban commuting with its sleek design and eco-friendly credentials.
Riding Towards a Sustainable Future
Chatsuwan highlighted the i300’s innovative design, high-performance specifications, and affordability as key differentiators in the competitive electric two-wheeler market. Unlike many electric vehicles, the i300 doesn’t rely on a dedicated charging infrastructure, making it a convenient option for riders. The portable batteries can be easily charged using a standard wall socket, ensuring flexibility and accessibility for users.
Expanding Horizons
Anticipating significant growth in the electric two-wheeler segment globally, particularly in emerging markets, Zapp has ambitious plans beyond Europe. Following the European launch, the company aims to penetrate Asian markets by late 2024. Leveraging receivables financing arrangements through the Export Import Bank of Thailand, Zapp plans to scale up operations efficiently and effectively.
Investor Insights
Investors are closely monitoring Zapp’s progress as it navigates the competitive electric vehicle landscape. According to InvestingPro Insights, Zapp’s market capitalization currently stands at a modest $20.85 million, reflecting its position in the industry. The company’s stock performance exhibits high volatility, suggesting potential fluctuations in share price that could impact equity sales under the funding agreement with Yorkville Advisors Global.
Navigating Challenges
Despite facing challenges indicated by a negative price-to-earnings (P/E) ratio and a significant decline in the 1 Year Price Total Return, recent momentum with a 24.2% return over the last three months provides optimism for investors. Zapp’s decision not to pay dividends aligns with its growth-focused strategy, aimed at reinvesting earnings for future expansion and development.
Looking Ahead
With Zapp’s i300 poised to hit European streets and plans for expansion into Asian markets on the horizon, the company is driving forward in the electric vehicle revolution. Investors are encouraged to delve deeper into Zapp’s financials and stock performance through InvestingPro’s comprehensive analysis to make informed decisions about the company’s prospects.
Source: Investing.com
Is Zapp Electric Vehicles Stock Halal? A Shariah Compliance Assessment
About Zapp Electric Vehicles
Zapp Electric Vehicles Group Ltd. is dedicated to designing, manufacturing, and selling high-performance electric vehicles. Its flagship product, the i300, offers urban commuters traditional motorcycle performance in a convenient step-through format. The company’s models include the i300 Carbon Launch Edition, i300 Carbon, i300 Bio, and i300 Ocean, catering to diverse consumer preferences in the electric vehicle market.
Screening Criteria Evaluation
1. Business Activity
Zapp Electric Vehicles Group Ltd. engages primarily in the design, manufacturing, and sale of electric vehicles. According to Shariah compliance criteria, the combined value of Non-Halal and Doubtful sources in the company’s revenue should not exceed 5%. Zapp’s non-Halal business activity percentage stands at 37.55%, above the permissible threshold.
2. Interest-bearing Securities and Assets
Shariah principles prohibit involvement in interest-bearing securities and assets beyond a certain threshold. Zapp’s interest-bearing securities and assets percentage amounts to 0.44%, significantly lower than the allowable limit of 30% of the company’s market capitalization.
3. Interest-bearing Debt
Another critical criterion for Shariah compliance is the level of interest-bearing debt. Zapp’s interest-bearing debt percentage is calculated at 2.75%, which falls below the permissible limit of 30% of the company’s market capitalization.
Even though it passed the 2nd and 3rd criteria, but it fails the first one.
Compliance Status
Shariah compliance screening of Zapp Electric Vehicles Group Ltd. based on AAOIFI standards shows that the stock is a NOT-HALAL STOCK.
Note: Figures above and Shariah compliance status are based on 2023 annual financial report of the company.
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