CyanConnde (LON:CYAN) has announced the commencement of an India contract relating to CyanConnode’s Narrowband Radio Frequency Smart Mesh Networks.
CyanConnde’s Smart Mesh Networks enable the Internet of Things (IoF) in end applications such as smart metering in power distribution.
Today’s announcement signals the eventual commencement of a Indian contract that had suffered delays, causing revenue to be recognised in a different accounting periods than previously expected.
Despite the delays, the first shipment of 10,000 CyanConnode OmniMesh Modules has been made to the project in India and the production of Smart Meters its set to begin shortly.
CyanConnode shares rallied over 11% in early trade on Monday following the news.
“The shipment is part of a contract to supply up to 200,000 Omnimeshenabled smart meters, worth £3.3m, as per the group’s press release issued in January 2020,” analysts at Arden Partners said in a research note.
“CyanConnode’s original expectation was that the installation of the project would be completed within fifteen months of kick-off, and that c.80% of revenue would have been recognised during the first two years with the remainder received over the 7-year support and maintenance contract commencing from the point of the project ‘going live’.”
CyanConnode pointed to COVID-19 slowing progress but were confident on ongoing demand and the growth of their Omnimesh Network Canopy.
“There has been a good start towards providing the Omnimesh Network Canopy, which will provide a hybrid RF Smart Mesh and Cellular communication network, that is licensed for up to 200,000 Omnimesh enabled smart meters,” said Anil Daulani, CyanConnode India CEO and MD.
“India is still seeing an increase of Covid-19 cases, and I wish to express my sympathies to families who have been affected. I remain optimistic and look forward to giving further updates relating to new orders in due course.”
CyanConnode shares were 11.68% stronger at 4.30p in early Monday morning trading in London.
