March 7th, 2022 | 11:54 CET
Linde, dynaCERT, NEL: Time for hydrogen technology
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"[...] We can convert buses and trucks to be completely climate neutral. In doing so, we take a modular and incremental approach. That means we can work with all current vehicle types and respond to new technology and innovation [...]" Dirk Graszt, CEO, Clean Logistics SE
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.
Why Linde no longer profits
The industrial group Linde is a specialist in gases. The construction of corresponding plants is also part of its core business. Linde is represented in almost all regions of the world. It is considered to have a promising future because of its hydrogen business. But Linde's image is starting to crack - until last Friday, Linde held on to two significant orders from Russia. At a time when almost all major companies are pulling out of Russia, Linde's actions are an anachronism. The orders are worth USD 6 billion and include two gas processing plants on the border with Estonia. Although Linde emphasizes that it wants to keep an eye on the developing sanctions framework, which indirectly means that the order does not yet appear to be completely secure, the Company is not taking any measures to withdraw, at least not on its own initiative, from Russia.
Even if the spirit of the times speaks a different language, Linde's behavior is understandable. After all, management is committed to its shareholders, and a premature end to such contracts could prove to be a boomerang in legal terms. Currently, Linde's share price is a bit battered, even if an upward trend can still be seen in the long term. The Company could nevertheless benefit from the sanctions against Russia, even if they are also a double-edged sword given existing major contracts for Linde from Russia.
dynaCERT: Saving fuel and CO2
Looking at dynaCERT's share price performance, one might think that the Company has been suffering from sanctions for months. But market mechanisms are merely taking effect here. dynaCERT stands for conversion kits for diesel engines. Thanks to this technology patented by dynaCERT, hydrogen is pumped into the cylinder during the combustion process. As a result, diesel consumption and CO2 emissions are reduced by 19%. dynaCERT also provides the appropriate software to document these savings and convert them into CO2 certificates, which is particularly important for companies with heavy machinery or large fleets. So why the downfall of the course?
dynaCERT is a growth company waiting for the big breakthrough. While the technology is already being used in some areas, major orders are lacking. The Company has recently reorganized its personnel and has already made some progress in certifying its technology. However, it is still unclear what the future holds. This uncertainty is also reflected in the share price. The value is down. However, the high energy prices give hope. When a barrel of oil costs USD 120, the savings of 19% are more significant than months ago. The stock remains a hot potato that has managed to surprise time and again in the past.
NEL: How long will the comeback last?
The invasion of Putin's army has multiple consequences: Bloodless NATO seems more motivated than ever, the EU remembers its ideals - and NEL's hydrogen stock is bucking its downward trend. Just over a year ago, NEL was trading above the EUR 3 mark. Today it is only EUR 1.40 because of the war in Ukraine. Just weeks ago, the share threatened to slip below the EUR mark. NEL is a specialist in the production, storage and transport of hydrogen. As gas becomes increasingly expensive in the wake of the escalation in Ukraine and is already considered harmful to the climate, the future technology of hydrogen could already play a more significant role in the present. In the same way that Chancellor Scholz has made EUR 100 billion available overnight for the German armed forces, investments in energy alternatives could soon be announced. In this case, NEL would be one of the beneficiaries. Currently, however, the share still looks very battered.
While Linde cannot be an unrestricted beneficiary of the current situation because of its business with Russia, things look different for NEL. However, the market has already priced in some of the hope here. The story is quite different for dynaCERT. The lost trust is weighing heavily on the share. For the courageous, this could be an opportunity. However, the share must be regarded as extremely speculative.
Conflict of interest
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