April 19th, 2023 | 08:20 CEST
Nel ASA, First Hydrogen, Volkswagen - Funding paves the way for green hydrogen
After the USD 750 billion US climate package, the European Union followed suit with the Green Deal Industrial Plan to remain competitive. At the end of March, the "EU Renewable Energy Directive" was rewritten with the goal of sourcing 45% of total power from renewables by 2030. This will add more speed to the expansion of renewable energies, which will ultimately also help hydrogen technology. The more green electricity is available, the cheaper green hydrogen becomes. At least EUR 100 billion are to be made available as subsidies by 2030. Today we look at 3 companies that could benefit from the subsidies.
time to read: 4 minutes
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Author:
Armin Schulz
ISIN:
NEL ASA NK-_20 | NO0010081235 , First Hydrogen Corp. | CA32057N1042 , VOLKSWAGEN AG ST O.N. | DE0007664005
Table of contents:
Author
Armin Schulz
Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.
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Nel ASA - Before the AGM
Nel ASA is one of the best-known hydrogen companies specializing in electrolysis technology and hydrogen refuelling. With the increasing demand for green hydrogen as a key technology for a sustainable energy future, Nel ASA is currently on a successful growth path. This can certainly be seen in the annual figures. At the end of 2022, the order book stood at around NOK 2.6 billion, up 112% on the previous year. The catch: losses also increased.
On March 14, HH2E announced its next major order, worth around EUR 34 million. The contract covers the delivery of 120 MW of alkaline electrolyzer equipment for HH2E's Lubmin project in Germany. The project aims to produce hydrogen from 2025 and significantly increase production by 2030. A target of 250,000 t of green hydrogen has been set. On April 21, the annual general meeting will take place, at which some critical questions will undoubtedly be heard.
After all, former CEO Jon Lokke sold over 70% of his shares last year. As long as the cash burn rate remains high, there will always be capital increases, ultimately diluting existing shareholders. The most recent one was at the beginning of March. It has put additional pressure on the share, which has been consolidating since February 8. Meanwhile, the upward trend has also been broken again, and the share is trading around NOK 13.41. Compared to its competitors, the stock is ambitiously valued despite not making any profits.
First Hydrogen - Introduces hydrogen-powered motorhome
Canadian company First Hydrogen is benefiting from an announced push to invest in a clean economy. In the province of Quebec, green hydrogen is to be produced, and hydrogen-powered commercial vehicles assembled. The Company is equally active in the UK and also works with German companies. Most recently, it partnered with UK fleet management provider Rivus to conduct operational tests with the first hydrogen-powered fuel cell vehicle. After one month, the results will be used to evaluate and optimize the vehicle and determine the total ownership cost. During the tests, fleet managers from various industries can test the light commercial vehicle.
While the 1st generation is in the test phase and already has road approval, the 2nd generation light commercial vehicle (LCV) was unveiled on April 3, which has both a hydrogen fuel cell electric drive and battery power. The Company has introduced a zero-emission hydrogen-based motorhome concept in collaboration with EDAG Group to expand the product range. The Company emphasizes the advantages of fuel cell electric technology, which is suitable for vehicles with long ranges and high energy requirements. The motorhome market is growing, and accordingly, this could become the next market for First Hydrogen.
For more information, visit researchanalyst.com (https://researchanalyst.com/en/updates/first-hydrogen-a-drumbeat-for-the-hydrogen-specialist), then mark your calendars for May 10. First Hydrogen will present at the 7th International Investment Forum (IIF) on this day. As an investor, you will have the opportunity to ask questions live after the Company presentation. Participation is free of charge. The share has been under pressure since the beginning of the year and is in the support area that extends from CAD 3.15 to CAD 3.42. Here the share has recently turned upward several times. The market capitalization is relatively low compared to many other hydrogen companies. The prospects for hydrogen-powered vehicles in the future are excellent.
Volkswagen - Also betting on hydrogen propulsion
The Shanghai Auto Show in China, the world's largest car market, is underway. But now, of all times, Volkswagen (VW) has to give up its supremacy in China to BYD. According to a report in Handelsblatt, for the first time, the Chinese company BYD sold more cars in the first quarter than the Wolfsburg-based company. This trend has been emerging for some time. In the first quarter, sales shrank by 14% YOY. No sooner had the article appeared in Handelsblatt than the news broke that VW intends to invest EUR 1 billion in a Chinese development centre.
Especially in electric cars, VW seems to have fallen behind BYD. In hydrogen, on the other hand, the Lower Saxons are trying to stay on the ball. Together with Kraftwerk TUBES GmbH, the Company is researching and developing a fuel cell that should enable ranges of up to 2,000 km. By 2026, the development should be completed so that the technology can be installed in a production vehicle. The main advantage of hydrogen vehicles over electric vehicles is the shorter refuelling time and the greater range and safety.
If the new Chinese development centre succeeds in reducing the development time by 30% as planned, new models can be brought to market faster. Then there could be a neck-and-neck race for pole position in China. Analysts are not entirely convinced by the group's strategy. In April, 3 out of 5 analysts recommend Hold, 1 Sell and 1 Buy. The price targets are between EUR 115 and EUR 150. Currently, the share is available for EUR 127.08.
Hydrogen has enormous potential as a key technology for a sustainable energy future and is supported by the promotion of investments in a clean economy. The expansion of renewable energy is driving hydrogen technology and making green hydrogen more competitive. Nel ASA must slowly develop into a profitable business. The framework conditions are good. First Hydrogen wants to cover the entire value chain for its hydrogen-powered light commercial vehicles and is already expanding its range of vehicles. Volkswagen has lost its top position in China for the time being. It will be interesting to see what the future holds for the Chinese car market.
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 hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.
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