indie Semiconductor Inc (INDI)

[JohnCM]

Indie Semiconductor SPAC: What Investors Should Know About The Autonomous Vehicle Play

December 15, 2020
Benzinga
By Chris Katje

A leading pure-play provider of semiconductor and software solutions for automotive companies is going public via a special purpose acquisition company deal.

The SPAC Deal: Indie Semiconductor is going public via the SPAC Thunder Bridge Acquisition II (NASDAQ: THBR). The deal values the company at an enterprise value of around $1 billion.

Shares of the new company will trade as "INDI" on the Nasdaq. Shareholders of Thunder Bridge Acquisition II will own 23.8% of the new company.

About Indie: Indie is helping automotive companies with autonomous connectivity, user experience and vehicle electrification.

The company said it has unparalleled semiconductor and software integration, with an efficient design process.

Indie has deals in place with 12 Tier 1-approved vendors, including Magna International (NYSE: MGA) and Aptiv (NYSE: APTV).

The company has already shipped more than 100 million devices and said it is increasing its OEM penetration and content per vehicle.

Indie lists Silicon Laboratories (NASDAQ: SLAB) and Ambarella Inc (NASDAQ: AMBA) as competitors.

Financials: Indie has a backlog of over $2 billion in deals and a pipeline of $2.5 billion in possible opportunities.

Revenue is estimated at $23 million for fiscal 2020. (2021 23M X 1.85 = 42.55M to$60M) (2022 42,55 X 1.85 = 78.72M to$110M) Revenue is expected to ramp up beginning in 2023, with estimates of $204 million, $349 million and $501 million, respectively, for the years 2023-2025.

From 2020 to 2025, Indie sees revenue growing at a compounded annual growth rate of 85%. Over 60% of aggregate revenue through 2025 is already at the shipping or won stage for the company.

Growth: The deal is expected to fund pent-up demand for additional programs, according to the company. Indie said its target market is $16 billion and will grow to $38 billion by 2025.

The strong demand for silicon and software inside automobiles is set to help Indie’s growth. Today, vehicles have around $310 in silicon content per vehicle. In the future, that total could rise to more than $4,000 per vehicle.

Multiple secular growth drivers like autonomous vehicles, connectivity in vehicles and electric vehicles are expected to help the company’s growth.

Phase II for the company also includes shipping a revolutionary lidar solution in 2023.

THBR Price Action: Shares of Thunder Bridge Acquisition II were up 3.6% at $10.80 at last check Tuesday. Shares traded over $12 in pre-market trading.