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March 16th, 2021 | 07:08 CET

BYD, Almonty Industries, Varta: Comebacks and insider tips

  • Commodities
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Shares related to electromobility and hydrogen have recently shown that trees do not grow to the sky on the stock market. Many a stock that was highly praised just months ago has since lost half its value. At the same time, however, it is clear that the trend toward new drive technologies will continue. In the fourth quarter of 2020, around one-fifth of newly registered vehicles in Germany were hybrids and pure electric cars. Reason enough to look at stocks that could still have potential now.

time to read: 3 minutes | Author: Nico Popp
ISIN: CNE100000296 , CA0203981034 , DE000A0TGJ55

Table of contents:

    Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG
    "[...] China's dominance is one of the reasons why we are so heavily involved in the tungsten market. Here, around 85% of production is in Chinese hands. [...]" Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG

    Full interview


    BYD: Solid Company, speculative stock

    BYD has been popular with investors for years. The former battery maker began years ago by initially electrifying smaller vehicles and public transportation. Thanks to a steep learning curve, the Chinese now have several electric cars on offer and have long since become more than a battery manufacturer. This market position is convincing more and more shareholders. The Company increasingly wants to sell its batteries to other manufacturers and thus promises lower unit costs.

    Even though the share price has fallen in recent weeks, BYD's strategy is paying off. After a loss of around 25% in one month, the share is more attractive in Germany than at the end of January, just above the EUR 20 mark. Although the next few trading days are likely to remain volatile, BYD's record chase could continue. However, prices below EUR 18 would be a warning signal. The share remains a hot topic.

    Almonty Industries: Tungsten producer with molybdenum fantasy

    Almonty Industries is also a hot stock in the best sense. In the past 3 months, the tungsten producer has posted a return of almost 80% - with no sign of market weakness. Almonty already operates two tungsten mines in Portugal and Spain. We know tungsten from the filament in classic light bulbs. But the industrial metal is also needed for electromobility. Almonty is currently in the process of bringing its tungsten mine in South Korea into production - permits and financing are already in place. This mine is set to become the largest tungsten mine outside China and should make a significant contribution to the Western world's independence from the giant empire.

    But the Sangdong project in South Korea offers more than just tungsten. In April, the Company plans to confirm existing historical data as part of a newly launched 12,500-meter drilling program. The goal here is to find and develop the high-grade molybdenum deposits suspected there. Almonty is already talking about the opportunity for a world-class molybdenum project on par with the tungsten mine. Molybdenum is used to harden steel and is also used in catalytic converters and solar cells. Molybdenum is also a topic around medical technology imaging processes. The Almonty share has already made substantial gains. However, the less than EUR 150 million market capitalization could still be too low given the various projects and prospects.

    Is the Varta share running out of juice?

    On the other hand, the Varta share is relatively too highly valued. Varta is a German Company that excels in high-quality rechargeable batteries and battery cells. Whether in headphones or hearing aids, with battery cells from Varta, the music always plays a little longer than with the competition. Last summer, electric car fantasies also flared up around Varta. Even subsidies were raised and the share took off dynamically.

    But meanwhile, there is not so much euphoria left. On a one-month horizon, the share has lost more than 25%. Although a return of 108% remains on an annual basis, the excesses of the beginning of 2021, when the share price surged to over EUR 175, are a deterrent signal that shows a lot of speculation here! The investment story around Varta is interesting, but the Company must first assert itself against the competition from Asia. Here, companies like BYD could be ahead of the game.

    Reducing complexity in the portfolio with commodity investments

    Investors who want to stay out of technical issues should instead focus on commodity producers that are in demand. The list of attractive raw materials that benefit from electromobility is long: copper, silver, tungsten, molybdenum or rare earths. The small producer Almonty Industries has two of these sought-after metals in the ground and is already mining tungsten. The share could therefore be an interesting second-tier pick.

    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 in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.

    Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.

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    Der Autor

    Nico Popp

    At home in Southern Germany, the passionate stock exchange expert has been accompanying the capital markets for about twenty years. With a soft spot for smaller companies, he is constantly on the lookout for exciting investment stories.

    About the author

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