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October 20th, 2021 | 12:10 CEST

Formycon, Memiontec, Synlab - Act before it is too late!

  • Investments
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When an unpredictable event occurs, humanity sees how powerless it is in the face of it. We saw this in the spring of last year with the outbreak of the Corona pandemic. Only since the approval of various vaccines has a normalization taken place. However, further, foreseeable problems are coming our way. According to expert forecasts, water demand will exceed supply by 40% as early as 2030. Some companies sense an opportunity to profit from the water shortage through novel technologies.

time to read: 3 minutes | Author: Carsten Mainitz
ISIN: FORMYCON AG | DE000A1EWVY8 , Memiontec Holdings Limited | SGXE56008290 , SYNLAB AG | DE000A2TSL71

Table of contents:

    Memiontec - Green-tech for decades

    The earth is covered mainly with water, accounting for 71% of the total, while only 29% percent of the earth's surface consists of landmass. Of the total water volume amounting to 1,332 million cubic kilometers, the much higher part of 97% is saltwater. Of the 3% of potable freshwater, in turn, only about one-third is accessible for human use, as the largest amount is located in high mountains and at both poles. Due to the growing world population and global warming, water is becoming increasingly scarce and precious.

    The Singapore-based Company Memiontec has been developing complete water and wastewater management solutions in China, Indonesia, and Singapore's city-state for 2 decades. The Company's clientele includes the public sector, such as municipalities and cities and private industrial companies. With a 4-pillar model, Memiontec covers the entire value chain of water management, which brings the Company enormous economies of scale.

    The provision of complete solutions, including maintenance contracts and the sale of modular and customized systems and equipment, are the prerequisites for the joint ventures founded with partners, which operate under the segments "Build-Own-Operate-Transfer" (BOOT) and "Transfer-Own-Operate-Transfer" (TOOT). Here, long-term contracts are concluded, usually for 25 years, and investments are made to maintain water treatment infrastructures. Memiontec then receives recurring payments through the supply and sale of treated water.

    A total of three of these projects exist currently, with a significant expansion planned for the future. Memiontec is also looking to grow through acquisitions and mergers in neighboring Asian countries. Recently, three orders with a total order value of the equivalent of EUR 51 million were announced. The Company is attractive in the long term and should continue to benefit from the water scarcity issue.

    Formycon - Important cooperation agreement

    The Corona pandemic produced several winners. Among them are vaccine producers and Formycon AG, one of the leading developers of high-quality biopharmaceutical follow-on products, or so-called biosimilars. With FYB207, the Munich-based Company has an ACE2 immunoglobulin fusion protein in the preclinical stage that has shown efficient in vitro neutralization of SARS-CoV-2 and its variants. SARS-CoV-2 and other coronaviruses utilize the ACE2 protein on the surface of human cells as a receptor for cell infection. Formycon has developed proprietary technology for human ACE2 immunoglobulin fusion proteins and created the innovative SARS-CoV-2 entry blocker FYB207. It effectively prevents cell infection and shows high protection against coronavirus escape mutations in cell cultures.

    A collaboration and license agreement for the development and commercialization of FYB207 with SCG Cell Therapy has been announced. Under the agreement, SCG gains access to Formycon's ACE2 fusion protein technology and acquires an exclusive license to develop, manufacture and commercialize FYB207 in the Asia-Pacific region, excluding Japan. In doing so, Formycon is eligible for potential development, regulatory and sales-related milestone payments of up to EUR 63.5 million, as well as royalties in the low double-digit percentage range on net sales. Formycon shares were able to form a bottom in the EUR 50 range. Concerning further corona research, the Company is promising.

    Synlab - Analysts cheer

    Also thrust into the spotlight by Corona is laboratory chain Synlab. The diagnostics service provider's test kits are used in schools in Germany, Switzerland and Frankfurt. With SARS-CoV-2 testing activity from July to September exceeding expectations, driven by the development of the Delta variant, full-year forecasts have been raised significantly.

    The Munich-based Company is now planning sales of EUR 3.5 billion. EBITDA is expected to reach the sound barrier of EUR 1 billion, compared to the previously estimated EUR 920 million. Following Synlab's forecast increases, several positive analyst voices were heard. Kepler Chevreux, Deutsche Bank, Jefferies, and Goldman Sachs all rate the stock as a "buy".

    The Corona pandemic hit humanity hard, as it was unprepared without vaccines and medication. The rapid development has benefited not only vaccine manufacturers but also companies such as Formycon and Synlab. Water scarcity is likely to be another problem in the coming years. Memiontec offers complete solutions for the water industry and should therefore profit in the long term.

    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

    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

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