11. May 2021 | 15:26 CET
Aurubis, Osino Resources, ThyssenKrupp - Winners of the digitalization, energy transition and e-mobility trends
The three trends mentioned have one thing in common: they need electricity. And wherever electrons do work, materials for transporting and storing electricity are in demand. Different materials are used depending on the application. Gold, for example, is mainly used in connectors, as is silver, but it is also found in numerous coatings, e.g., for seat heaters or in infotainment systems. Copper, on the other hand, is the material of choice for all cable connections, while materials such as lithium or cobalt are needed to store electricity or hydrogen in the future. The following companies are fully in line with the trend with their products and should not be missing in any portfolio.
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ISIN: DE0006766504 , CA68828L1004 , DE0007500001
"[...] We quickly learned that the tailings are high-grade, often as high as 20 grams of gold per tonne; because they are produced by artisanal miners, local miners who use outdated technology for gold production. [...]" Ryan Jackson, CEO, Newlox Gold Ventures Corp.
Aurubis AG - Significantly higher profit in the first half of the year thanks to strongly increased copper prices
The Hamburg-based copper group Aurubis AG increased its operating earnings before taxes by 72% to EUR 103 million thanks to the strong rise in copper prices in the last twelve months. The price of a tonne of copper almost doubled to a current all-time high of USD 10,350. Consolidated profit rose by the same amount to EUR 79 million. However, this development had already been anticipated, so the Company merely confirmed its forecast for the year. However, if one considers that the analysts at Bank of America recently declared a short-term increase in the copper price to USD 13,000 per ton as probable, there should still be room for Aurubis to improve.
In particular, the recovery of the global economy in the post-Corona era and the associated return to focus on global climate protection targets will trigger a further surge in demand for raw materials for the energy transition. Up to 20% more copper will be needed for battery-electric vehicles than for conventional drives. Aurubis, which is also one of the world's leading companies in recycling non-ferrous metals, should be well-positioned with its range of products and services.
Osino Resources Corp. - Twin Hills project in Namibia makes giant strides forward
In addition to its importance to the energy and mobility trends of the future, gold has always been the most sought-after asset class in times of economic instability, rampant inflation and in the face of rising sovereign debt. If you consider that all the gold ever mined on earth fits into a cube with an edge length of 21 meters, you can easily imagine how rare the precious metal is and how costly gold production is. It is a good thing that there are companies like Canada's Osino Resources Corp. that are engaged in identifying and developing global gold deposits.
The Company's current main project is called Twin-Hills and is located in Namibia, an economically and politically stable country with a long mining tradition. The project is located in Namibia's Damara Sedimentary Belt, also known as the Namibian Gold Belt; here, other mines, such as the well-known Navachab and Otjikoto, are already in operation. The latter, by the way, was developed by a team around the current President and CEO of Osino Resources, Heye Daun, and sold to the Company B2Gold, which today operates the mine extremely profitably. With the exploration of the Twin Hills gold deposit already underway since 2016, an initial estimate of gold reserves of around 1.9 million ounces has now been established, at a grade of 1.1g/t, after 69,000 meters of drilling and 125 drill holes have been put down. An additional 75,000 drill meters are planned for the current year. In addition, a feasibility study is to be prepared by the end of the year at the latest.
The available results, the management team's experience, and the planned further project steps were reason enough for the analysts of Sprott Equity Research to increase their price target for the shares of Osino Resources, which incidentally is also traded in Frankfurt, to CAD 2.55. Thus the paper, which is currently quoted at CAD 1.24, has doubling potential. High-risk, high-return investors who want to profit disproportionately from the boom in demand for gold, should add the stock to their portfolios. After all, exploration companies typically promise a much higher return than established gold producers when entering the market at an early stage.
ThyssenKrupp - Big player in low-emission steel production
Climate change and the energy transition are not stopping at traditional German companies. On the one hand, steel production will have to be operated with lower emissions in the future if international climate protection targets are to be met. On the other hand, novel technologies also offer unique opportunities for groups. Both apply to the traditional German Group ThyssenKrupp. The Company is increasingly involved in the production of "green steel," where emissions are reduced, for example, through ecologically generated electricity or the use of new technologies such as ThyssenKrupp's EnviBAT system for reducing emissions in the coking process. Through its chemical plant subsidiary Uhde Chlorine Engineers, jointly owned with Italian partner De Nora, which is currently the market leader in producing electrolysis plants for chloralkali production, the Group will also be active in the construction of large-scale hydrogen electrolysis plants in the future.
The Company's commitment to hydrogen is no coincidence. If steel is to be produced in a climate-neutral way, this will only be possible in the future by replacing coal with hydrogen. To ensure an optimum supply of this essential element, ThyssenKrupp is therefore planning to set up international supply chains for imports and efficient distribution together with its partners HKM and the port of Rotterdam. Expertise in sustainable steel production is also in demand internationally. A major order was recently secured from China for the construction and supply of four low-emission coke oven stamp batteries with a total annual capacity of 3.9 million tons. We believe the traditional German Group is on the right track with this strategy. This assessment is also reinforced by the announcement made a few days ago by the German Minister of Economics, Peter Altmeier, to support the switch to green steel production with an additional EUR 5 billion over the next three years. Analysts, incidentally, seem to agree. The consensus of analysts' estimates is currently at a target price of EUR 14.18, which means a potential of around 25% at the current share price.