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Humphrey Hale, CEO, Managing Geologist, Carnavale Resources Ltd.

Humphrey Hale
CEO, Managing Geologist | Carnavale Resources Ltd.
Level 2, Suite 9 389 Oxford Street, WA 6016 Mount Hawthorn (AUS)

info@carnavaleresources.com

Interview Carnavale Resources: Good cards for long-term success


Bill Guy, Chairman, Theta Gold Mines Limited

Bill Guy
Chairman | Theta Gold Mines Limited
Level 35 (ServCorp), Intl Tower One 100 Barangaroo Ave, 2000 NSW Australia (AUS)

info@thetagoldmines.com

+61 2 8046 7584

Interview Theta Gold Mines: This team has already brought 20 mines into production


David Mason, Managing Director, CEO, NewPeak Metals Ltd.

David Mason
Managing Director, CEO | NewPeak Metals Ltd.
Level 27, 111 Eagle Street, QLD 4000 Brisbane (AU)

info@newpeak.com.au

+61 7 3303 0650

Interview New Peak Metals: Many chances for great success


11. May 2021 | 10:12 CET

BYD, Silkroad Nickel, Volkswagen - Exciting development in the electric car industry!

  • Nickel
Photo credits: pixabay.com

So far, the development of the electric car industry has been trouble-free, the sales figures of e-car manufacturers have skyrocketed and the displacement of combustion engines seemed to be only a matter of time. But currently, the first major obstacle is approaching producers. The chip shortage is leading to production stops and short-time work. The issue of scarcity is likely to become the dominant theme of this industry over the next few years. Raw materials for production such as lithium, nickel or cobalt are scarce commodities. The primary beneficiaries of this development are the raw material producers, who are already barely able to meet demand.

time to read: 3 minutes by Stefan Feulner


Jerre Foo, Corporate Development Executive, Silkroad Nickel
"[...] China has become the manufacturing capital of the World, and because of its infrastructure, expertise and capabilities, Silkroad Nickel has strategically positioned itself to partner with Chinese companies in the Stainless Steel and EV industries [...]" Jerre Foo, Corporate Development Executive, Silkroad Nickel

Full interview

 

Author

Stefan Feulner

The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
He is passionate about analyzing a wide variety of business models and investigating new trends.

About the author


Scarce commodity

When it comes to batteries for electric cars, everyone talks about the lithium shortage. However, it is not lithium but nickel that is the key metal, especially since a higher nickel content significantly increases the efficiency of the batteries. Car manufacturers are currently fighting for the highest range to be able to increase their market shares further. Several years ago, Tesla founder Elon Musk turned to mining companies and asked them to mine more nickel. In return, he offered companies "a huge contract over a long period of time if you mine nickel efficiently and in an environmentally friendly way."

At the heart of the nickel industry: Global primary nickel supply is dominated by Indonesia, which supplies 27% of the world market. Silkroad Nickel is the only nickel Company listed on the SGX. In addition, the stock is also tradable in Frankfurt. The Company's vision is to become a global nickel producer, supplying the stainless steel and electric vehicle industries worldwide. Already, Silkroad Nickel is cooperating with major Chinese companies to produce higher value-added nickel products in Indonesia for export markets. Most of the future nickel supply is expected to come from closer cooperation between Indonesian and Chinese companies. Chinese groups largely already hold stakes in Indonesian mining companies or have long-term offtake agreements.

The subsidiary of Silkroad Nickel, which focuses on the exploration, mining, production and sale of nickel ore, has an ongoing offtake agreement for 700,000 tons of nickel with the Chinese steel conglomerate Tsingshan. Tsingshan operates the world's largest ferronickel and stainless steel plant in the Morowali Industrial Park in Indonesia. An estimated USD 90 million in revenue will be generated by this agreement over a 2-year period. The cash flow and value of the group will increase tremendously as a result, as net margins will be around 30-35% of sales.

Future electromobility

Management sees the main driver of nickel demand in the coming years coming in from the automotive industry. Due to the need for batteries, a growth of 23% is forecast until 2030. Here, too, Silkroad Nickel has the best prerequisites to become a global player. Due to the already existing production of laterite ore, the Indonesians can now mine NPI, a core ingredient in stainless steel production, more cost-effectively. These are the basic requirements for entering the EV battery industry, as the ore consists of nickel and cobalt, two important metal components needed for the production of EV batteries.

The breakthrough for perfect positioning would be the entry of Ganfeng Lithium, the world's largest lithium producer and a leader in vehicle batteries, with key customers such as Tesla and Volkswagen. The latter wants to inject capital of up to USD 30 million into Silkroad Nickel via a convertible bond. A term sheet has already been signed and due diligence is currently underway. The stock market value of Silkroad Nickel is presently EUR 60.08 million. An entry of a global player like Ganfeng Lithium would lift the Company into new dimensions. Interested investors should limit their investment due to the tight market.

Difficult times for BYD

Not only is the share price in the basement, but the Chinese electric car manufacturer BYD is also currently experiencing operational problems. The delivery figures for April were increased from 40,800 to over 45,000 units compared to the previous month. In the case of NEVs, the purely electric cars, however, there was a slight decline compared to the previous month with 16,114 units. In chart terms, the share price was quoted at EUR 14.81 yesterday. At EUR 14.50, there is a broad support zone. Due to the current oversold nature of the share, a successful test could result in a trading opportunity with a first price target of EUR 18.

Volkswagen is rebuilding

The Volkswagen plant in Emden is being transformed into an e-location. In the first half of 2022, the East Frisian site will complete the conversion and start volume production of e-vehicles. Until Emden becomes a pure e-plant, the Lower Saxony site will continue to produce the Passat and Arteon and Arteon Shooting Brake models in a transition phase lasting several years. The core of the conversion is the new assembly hall for e-vehicles, which also includes a battery warehouse. While the signs in Emden point to growth, the VW share price is currently still stuck in consolidation. The shares are presently trading at EUR 210. Technically, one should wait for a test of the striking support zone at EUR 200.


Author

Stefan Feulner

The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
He is passionate about analyzing a wide variety of business models and investigating new trends.

About the author



Conflict of interest & risk note

In accordance with §34b WpHG we would like to point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH may hold long or short positions in the aforementioned companies and that there may therefore be a conflict of interest. Apaton Finance GmbH may have a paid contractual relationship with the company, which is reported on in the context of the Apaton Finance GmbH Internet offer as well as in the social media, on partner sites or in e-mail messages. Further details can be found in our Conflict of Interest & Risk Disclosure.


Related comments:

15. June 2021 | 14:17 CET | by André Will-Laudien

NIO, Volkswagen, Toyota, Silkroad Nickel - Now it really starts!

  • Nickel

Armin Laschet (CDU), the CDU/CSU candidate for chancellor, does not want to give the internal combustion engine an expiration date, even though he himself drives an electric car. He also warns against focusing solely on the electric vehicle regarding climate protection in the transport sector. "I do not believe that this will be the form of mobility for the next 30 years, even though I drive an electric car myself," the CDU federal chairman told Handelsblatt. "There are ecological implications, for example, in battery production and the extraction of raw materials. We will still see many technological leaps." So in terms of e-mobility, the last word has not yet been spoken. Nevertheless, the industry is gearing up for a politically motivated wave of purchases. For this, it needs raw materials.

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11. June 2021 | 11:46 CET | by Stefan Feulner

BYD, Silkroad Nickel, Baumot - WallStreetBets: Enough is enough!

  • Nickel

Yesterday windeln.de and Adler Modemärkte, today Baumot and Nanogate. Every day, a new sow is driven through the village by the gambler community. There are no fundamental reasons for these stocks. The trend, which was started by the Reddit subcommunity WallStreetBets, is now spilling across the pond into Germany. There are companies, especially with regard to the energy transition, that have real potential due to their growth and profit prospects.

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01. June 2021 | 08:30 CET | by Nico Popp

HeidelbergCement, Silkroad Nickel, BYD: Shares with an explosive mix

  • Nickel

You do not have to be an economist or a well-connected investment guru to evaluate opportunities on the stock market. It is often the apparent developments and trends that point the market in the right direction. For investors, it is then a matter of interpreting these facts. For example, building materials are scarcer than ever - prices for wood and other essential materials have risen rapidly. Industrial metals are also in high demand. New technology, investment in construction and infrastructure, and the end of the pandemic make for an explosive mix.

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