Close menu

May 24th, 2022 | 12:21 CEST

Altech Advanced Materials, Varta, Mercedes - This way!

  • Electromobility
  • Battery
Photo credits:

The latest data from the Federal Statistical Office speak a clear language. E-cars are increasingly in demand. Around 90% of German e-car production is exported. "Made in Germany" therefore still scores points. The performance of the batteries, adequate infrastructure and the availability of essential raw materials such as lithium are important parameters for rapid market penetration. Innovations always remain the trump card. Germany certainly doesn't have to hide in this respect.

time to read: 3 minutes | Author: Carsten Mainitz

Table of contents:

    Altech Advanced Materials - Pre-feasibility study underlines great potential

    The results of the pre-feasibility study (PFS) for the planned plant for ceramic coating of anode composite material in Schwarze Pumpe, south of Cottbus, have given the share a significant boost to date. The market capitalization of the micro-cap, currently just under EUR 7 million, is offset by a much higher potential value.

    The Heidelberg-based company develops innovative processes to make batteries significantly more powerful. The nanocoating of battery materials with high-purity aluminium oxide and an enrichment of silicon can prevent the deposition of lithium particles on the electrodes. The problem of standard processes that lead to a loss of capacity after the first charge is thus eliminated.

    The Company expects to develop batteries with 30% higher energy density and improved battery life using the ceramic-coated anode composite material. This technology could prove to be a game-changer.

    According to the PFS, the project's pre-tax net present value (NPV) is around EUR 420 million! That puts the value of Heidelberg's ownership stake of 25% at around EUR 105 million. The high profitability is also reflected in an internal rate of return (IRR) of 40% and an investment payback period of just 3.1 years. Ten thousand tons per year (TPY) can be produced at total production capacity. On average, the Company expects an annual operating profit (EBITDA) of around EUR 52M.

    In view of the technological potential of the Altech solution and the high expected return, the valuation discrepancy between stock market value and project value should be significantly reduced in the medium term.

    Varta - Significant recovery forecast for the second half of the year

    After an opening quarter marked by the Ukraine war and the long-term consequences of COVID-19, in which revenues and operating income fell, the southern German company prepared the investment community for a problematic Q2. For the second quarter, the Company has forecast revenues of between EUR 195 million and EUR 205 million and adjusted EBITDA of between EUR 34 million and EUR 38 million.

    The group expects new product launches from customers such as Samsung and Apple in the second half of the year, which should significantly boost demand for lithium-ion button cells for wireless headphones. For this reason, Varta confirmed its guidance for the full year with consolidated sales of between EUR 950 million and EUR 1 billion, corresponding to growth of up to around 10%.

    Berenberg and JPMorgan formulate a price target of EUR 95 for the share certificates, which results in a potential of around 20%. At EUR 3.2 billion, the Company is thus valued at a good three times its expected sales in 2022. According to average analyst expectations, the 2022 P/E ratio is a sporty 30 and drops to 25 in the following year. More visibility regarding the e-mobility business, i.e. the planned production of high-performance batteries, should help the share price performance.

    Mercedes - "Class instead of mass"

    By spinning off its car and transport division (Daimler Truck Holding) a few months ago, Mercedes Holding is focusing on its strategy. The group wants to bring Mercedes to the fore as a luxury brand. After all, in times of semiconductor shortages and supply chain disruptions, price increases in the high-priced segment can be passed on unproblematically to the affluent clientele.

    But the topic of e-mobility is also a strategic cornerstone. The Company already announced its intention to push in this area last year. The foreign trade data of the German automotive industry support these plans. The Federal Statistical Office recently announced that about 90% of the approximately 328,000 e-cars produced in Germany were exported, worth EUR 12.6 billion. The United Kingdom, the United States and Norway saw the highest demand.

    Investors who joined the Company 12 months ago enjoyed a dividend payment of EUR 5 per share certificate in April. However, the share price has not moved on the bottom line. Analysts believe the share has an average upside potential of a good 40%. With a P/E ratio of 5 to 6 for the current and the next fiscal year, the Company's valuation can be classified as moderate.

    E-mobility solutions made in Germany - that is what the three companies mentioned stand for. Mercedes and Varta have formulated ambitious goals. Altech could turn the industry upside down with its innovations. The share price should then be at a completely different and much higher level.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and the like on These contents are exclusively for the information of the readers and do not represent any call to action or recommendations, neither explicitly nor implicitly they are to be understood as an assurance of possible price developments. The contents do not replace individual expert investment advice and do not constitute an offer to sell the discussed share(s) or other financial instruments, nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but a journalistic or advertising text. Readers or users who make investment decisions or carry out transactions on the basis of the information provided here do so entirely at their own risk. No contractual relationship is established between Apaton Finance GmbH and its readers or the users of its offers, as our information only refers to the company and not to the investment decision of the reader or user.

    The acquisition of financial instruments involves high risks, which can lead to the total loss of the invested capital. The information published by Apaton Finance GmbH and its authors is based on careful research. Nevertheless, no liability is assumed for financial losses or a content-related guarantee for the topicality, correctness, appropriateness and completeness of the content provided here. Please also note our Terms of use.

    Der Autor

    Carsten Mainitz

    The native Rhineland-Palatinate has been a passionate market participant for more than 25 years. After studying business administration in Mannheim, he worked as a journalist, in equity sales and many years in equity research.

    About the author

    Related comments:

    Commented by Juliane Zielonka on November 30th, 2023 | 07:00 CET

    Growth Industries in Focus: Investors see potential in Defense Metals, BASF and Volkswagen shares

    • Mining
    • Tungsten
    • RareEarths
    • Electromobility

    Investors are looking for opportunities in growing markets. Looking at industries currently requiring rare earths - such as energy, defense, electromobility, and many more - leads to the mining sector. Someone has to supply the valuable raw materials so these industries can continue growing. Defense Metals' Wicheeda project in Canada shows promising results, particularly the increase to 6.4 million tons with a TREO content of 2.86%. BASF secures EUR 124.3 million in government funding for a green hydrogen plant in Ludwigshafen, planned in collaboration with Siemens Energy. Volkswagen is facing challenges, emphasized by VW board member Thomas Schäfer, who announced tough cuts to maintain competitiveness without closing plants. Volkswagen will have to respond to change with a more agile approach, especially as China advances in electromobility.


    Commented by Fabian Lorenz on November 22nd, 2023 | 07:20 CET

    BYD with "Tesla killer", JinkoSolar with sales record, and Klimat X Developments with milestone payment

    • Sustainability
    • climatechange
    • Electromobility
    • renewableenergies

    BYD is currently bursting with energy. The Chinese company is rushing from one sales record to the next. To ensure this continues in the coming year, BYD has unveiled two new "Tesla killers". The mid-range SUVs are designed to make life difficult for the Model Y. For those without a climate-neutral business model, CO2 certificates can be purchased from Klimat X Developments. The Company has just received a milestone payment. When will the shares of the innovative company benefit? JinkoSolar shareholders also need to be patient at the moment. The share is not taking off despite the solar group doing well operationally. While the Chinese have reason to celebrate, another competitor disappoints once again.


    Commented by André Will-Laudien on November 21st, 2023 | 07:15 CET

    Attention: New battery technology in demand! Freyr Battery, Manuka Resources, Varta and IBU-tec in focus

    • Mining
    • BatteryMetals
    • Electromobility
    • climatechange

    Despite all ecological reservations, the electrified future is advancing. In an effort to combat climate change, politicians have decided on the complete electrification of the future. The plan to entirely displace fossil fuels will lead many countries into a new economic dimension that will outperform conventional economies for a long time. However, a beautiful, new world must be economically affordable. This requires significant technological advancement and a tremendous amount of money for the transformation; ideological thinking helps little in this regard. Central Europe, in particular, is an importer of raw materials and energy and is a long way from setting world-changing parameters. However, since everything has already been decided in Berlin, millions of batteries and stationary energy storage systems are now needed for the green transformation. The key here is access to the critical metals of the future. These strategic decisions are being evaluated in the stock market. It is worth doing the math.