DAVY VIEW

As a result of the shortage in mobile standalone headsets from hardware providers and subsequent discussions with management, we have revised down our 2020 and 2021 estimates for VR Education Holdings (VRE). A lack of available hardware weighed heavily on expected ENGAGE volumes, leading to a miss on FY 2019 revenue and disrupting top-line growth forecasts. However, although the growth trajectory has been significantly affected, the group has allied with several hardware providers to rectify the issue. VRE’s revenue visibility is now more appropriately reflected in our revised estimates, and the company remains well positioned to capitalise on the evolving virtual reality (VR) headset market.