July 18th, 2023 | 07:10 CEST
FREYR Battery, Manuka Resources, Nio - The profiteers of the battery revolution
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"[...] 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
FREYR Battery - Tailwind from the EU
The developer of batteries and battery cells for electromobility, energy storage systems, and marine and aerospace applications started the new trading week with a share price increase of over 3% to USD 9.55. With this, the Luxembourg-based company is struggling to cross the 200-day line, currently at USD 9.66. Should this resistance and last week's high at USD 10.10 be overcome, the annual high from January at USD 11.16 is already calling.
The reason for the upswing was the promise of funding of EUR 100 million by the European Union for the development of the Giga Arctic project in Norway. The sum will be disbursed through the EU Innovation Fund, which subsidizes regional production of battery solutions. The Giga Arctic plant is expected to produce a volume of 29 GWh. It is to be operated entirely with renewable hydropower.
In addition to building the factory in Norway, FREYR has announced the potential establishment of industrial battery cell production in the United States and Finland. FREYR plans to establish 50 GWh of battery cell capacity by 2025, 100 GWh annually by 2028, and 200 GWh annually by 2030.
Analysts polled on Refinitiv continue to be positive. Accordingly, the average price target of the experts is USD 14.00.
Manuka Resources - Steadily increasing cash flow
It is a bit of a paradox. While Manuka Resources is making good progress with its gold and silver deposits and even has the potential to become one of the largest suppliers of green technologies in the world with its South Taranaki Bight vanadium project, the share price of Australia's youngest gold and silver producer has corrected by more than 70% since December last year to currently AUD 0.057. The stock has been in a sideways trend since the beginning of May and should complete its bottoming process when it leaves the short-term downtrend at AUD 0.063.
With the Mt. Boppy mine, Manuka Resources calls one of the historically richest gold mines in Australia its own. The property in the Cobar Basin has historically produced 500,000 ounces of gold at an average grade of half an ounce per ton of ore. Recently, production has resumed with the goal of mining 20,000 to 25,000 ounces of gold p.a. over the next 4 years. For this fiscal year, the Company estimates approximately 10,000 ounces of gold. In addition, the resource estimate of Mt. Boppy is to be further expanded. Exploration will also continue at the McKinnons Mine and Pipeline Ridge projects. Manuka has already secured financing through a capital increase of AUD 2.4 million. In addition, the Australians had a cash balance of AUD 5.2 million at the end of the first quarter.
In addition to the Mt. Boppy mine, the Australians own the Wonawinta Silver Project. This deposit has a mineral resource estimate of 51 million ounces, making it one of Australia's largest silver producers.
Manuka Resources also has an ace up its sleeve with the South Taranaki Bight project, which contains vanadium needed for large-scale industrial applications. Compared to their lithium-ion counterparts, vanadium-based batteries are known to lose significantly less energy. This characteristic makes them a preferred choice for solar and wind power systems. The prospective project has already been granted a mining license to produce 5 million tons per year, with a planned initial mine life of 20 years. Assuming a production rate of 5Mt of VTM concentrate per year, according to the BFS1 study, annual concentrate production would include 25,000t of vanadium oxide. As a result, Manuka Resources would be responsible for about 15% of global production.
Nio - Potential exhausted
In contrast, the analyst consensus sees little potential in the shares of electric car manufacturer Nio. A total of 31 financial experts were surveyed, and according to Refinitiv, the vote was nine times "strong buy", twelve times "buy", and ten times "hold". The average price target was USD 10.90, which is only marginally above the current price of USD 10.44. From a chart perspective, the Nio share is struggling to hold the 20-day line at USD 10.20. A slide below the support could put an end to the recovery that has been underway since June for now and send the price back into the zone in the USD 9 area.
The Chinese company could receive new impetus from Thursday. Here, the third company-owned Nio Power Day will take place. During the three-day event held in Beijing, the Company aims to present a comprehensive overview of the latest Power-Up Layout Plan, product technology, and services offered by Nio Power. Analysts and investors expect details about the 150-kWh semi-solid-state battery pack** to be one of the main topics at the event.
In late May, William Li, Founder, Chairman and CEO of Nio, announced at the launch of the new ES6 that the 150-kWh semi-solid-state battery pack would be available in July. Owner's manuals for its vehicles were already updated earlier this month to accommodate the 150-kWh battery pack.
Buoyed by EUR 100 million in EU funding, FREYR Battery could climb to new highs for the year. At Nio, the investment community awaits news on the occasion of the 3rd Nio Power Day. Due to the start of production at Mt. Boppy, Manuka Resources will receive a significantly higher cash flow in the future.
Conflict of interest
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