January 26th, 2023 | 20:11 CET
Big surprise for Tesla hunter BYD and JinkoSolar: when will dynaCERT share takeoff?
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"[...] We know exactly what we are doing and are implementing what we consider to be a proven technology in an industrially applicable and scalable way. [...]" Uwe Ahrens, Director, Altech Advanced Materials AG
dynaCERT: Emission certificates would cause a revaluation
A market worth billions has emerged worldwide around the trade in emission certificates. In the future, dynaCERT also wants to get involved in this market. Potential customers are companies that need to offset their greenhouse gases to achieve their ESG targets. These are, for example, oil and gas producers as well as mining and transportation companies.
For dynaCERT, the certificates would represent a recurring source of revenue. Because with the management of carbon credits for their HydraGEN customers, the business model is based on the sharing of revenues generated by the sales of carbon credits. In addition, the Canadians want to place a carbon credit convertible bond with a volume of up to CAD 10 million to finance the growth of the core business.
At its core, dynaCERT is a provider of systems - based on the so-called HydraGEN technology - for reducing CO2 emissions and fuel costs of vehicles - especially for fleet operators. Demand has picked up noticeably in the past year. Several fleet operators - including mining groups - have placed orders. The individual unit numbers are manageable, but one has a foot in the door. In December, a total of 137 existing orders were reported. The emission certificates of dynaCERT are to reach the Verified Carbon Standard of Verra. According to the Company, this is in the final phase. Thus, the certification would be validated by the company Earthood. If the certification and the placement of the convertible bond succeed, a revaluation of the Company would be likely.
BYD: E-cars soon "Made in Germany"?
Next to Tesla, BYD is the most successful manufacturer of e-cars. Up to now, the vehicles have essentially been offered in the domestic market. BYD has ambitious expansion plans for 2023. In Germany, the Chinese are starting with three models: The ATTO 3, Tang SUVs and the Han luxury sedan. On the one hand, sales are to take place via flagship stores in major German cities. On the other hand, six dealer groups with a nationwide network of car dealerships carrying established premium brands such as Mercedes-Benz and BMW are to offer BYD vehicles. According to "manager magazin," BYD plans to sell 120,000 electric cars in 2026 in Germany alone. That would correspond to a market share of around 10%.
But will the Chinese go further and produce in Germany as well? The Wall Street Journal reports talks between BYD and Ford. In the process, the US automaker could part with its plant in Saarlouis. The Ford Focus is produced there. However, the plant will only be closed until 2025, when Ford plans to reduce the number of employees in Germany by more than 3,000 in the coming years. According to IG Metall, layoffs are also planned in Cologne.
JinkoSolar: Profit doubled and price target increased
For the solar industry, 2022 was a strong year. Market leader JinkoSolar has also benefited from this. The group has published the first preliminary figures for its operating subsidiary JinkoSolar. According to these, JinkoSolar achieved a net income of CNY 2.66 billion to CNY 2.96 billion in fiscal 2022. In 2021, it was CNY 1.52 billion to CNY 1.82 billion less. Profit was thus significantly more than doubled.
JinkoSolar also reported the launch of a reference project in Saudi Arabia. After securing financing, construction could begin on the 300 MW Saad solar PV project. Jinko manager Mothana Qteishat said, "A great start to 2023, the completion of the Saad project underlines our commitment to His Royal Highness Prince Mohammad Bin Salman and Saudi Arabia's Vision 2030. This fits very well with our track record in the region, where we have the world's largest single-site solar plant in operation (1.2 GW Sweihan project in Abu Dhabi) and the world's largest single-site plant under construction (2.1 GW Dhafra project in Abu Dhabi). We are pleased to have selected Elsewedy Electric as our partner and EPC contractor for our first project in the Kingdom, bringing its regional expertise."
This year, Jinko's stock has also rebounded. Within a few weeks, it went from below EUR 40 to over EUR 50. Most recently, Roth Capital upgraded the share of the Chinese solar group from "Neutral" to "Buy". The analysts raised the price target from USD 50 to USD 70.
Electromobility is shaking up the automotive world. If BYD were to actually buy the Ford plant in Saarland, it would be a strong signal. Orders are now coming in at dynaCERT. If the emission certificates and the bond placement also work out, the share price should increase in 2023. Operationally, JinkoSolar is on top. The share may also come to life again in the current year.
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