Ceres Power "Powering Up: royalty upside takes PT to £9.7, and we see..."

Research evidence excerpt

Ceres Power "Powering Up: royalty upside takes PT to £9.7, and we see..."

o 2030 estimates

if traction continues with data centre customers via their partners in SOFC. Ceres is set for 2026 to be

a transformation year for EBITDA breakeven and restructuring has driven cash burn down to ~£20m

a year, from £40m a year (when no partner joins), and we now forecast positive FCF generation

across 2026-28. The recent partnership with Centrica further repositions SOFC tech as a serious

solution where the grid rollout is constrained. Further licence momentum is likely in 2026/27, as

Ceres commercialises its unique solid oxide (SO) tech which has an attractive cost trajectory vs. peers

and traditional power generation technology.

EVIDENCE Partners have signalled strong capital commitments, and Weichai signed a licence deal in 2025 after

it invested ~£220m from 2018-22 in Ceres’ technology, and Doosan has a factory open in S. Korea

and has medium-term targets for ~200MW of capacity.

WHAT´S PRICED IN? We think ~6GW of fuel cell (SOFC) cumulative deliveries, are priced in currently. That compares to a

total addressable market of 20GW p.a by 2030 estimated by Ceres. As a reminder, 1GW of

shipments for SOFC is equivalent to £50-100m of EBITDA, with a stack replacement life of ~5 years.Please

Upside/Downside

Spectrum

Electrolyser

2027E new licence Valuedrivers Royalties in 2027 SOEC market share WACC

partners

2030-50E

£12.0/share upside 2 new partners £30m 25% 9.0%

£9.7/share base 1 new partner £12m 15% 10.5%

£4.0/share downside No new partner £4m 5% 12.0%

Source: UBS estimates

Company Description Ceres Power is a technology licensing company, with highly differentiated 'solid oxide' fuel cell

(SOFC) and electrolyser products.