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October 27th, 2022 | 11:31 CEST

Next push in e-mobility: Porsche, Kodiak Copper, Nio and BYD in investors' focus!

  • Copper
  • Renewable Energy
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It would not be correct to project the important raw material copper purely onto e-mobility. Of course, global copper demand is rising due to many electrical engineering applications. But it is also falling in the wake of a slowing construction boom. If fewer houses are built worldwide, the copper demand will fall more sharply than repeatedly forecast. In principle, however, the trend for 2024 and beyond points strongly upward. Mobility will have to make a major move in the direction of e-mobility if the climate targets of the politicians currently in power are to be implemented - out with the combustion engine, in with e-mobility. In the medium term, this means three times as much copper is needed as in 2015. Which shares will come into focus?

time to read: 5 minutes | Author: André Will-Laudien
ISIN: BYD CO. LTD H YC 1 | CNE100000296 , BYD CO. LTD ADR/2 YC 1 | US05606L1008 , NIO INC.A S.ADR DL-_00025 | US62914V1061 , PORSCHE AG | DE000PAG9113

Table of contents:

    Copper - The red metal follows the economic trend

    New and higher sales figures from e-mobile manufacturers keep filling the gazettes. This is good news because it reduces air pollution from harmful greenhouse gases. Still, the share of e-mobiles among all vehicles worldwide is in the single-digit percentage range, but the growth trends speak a clear language: the world will move to electric mobility! However, anyone following the price of copper should note one important point. Copper is an essential industrial metal that is not only used in cars. The biggest consumer is the construction and infrastructure industries. And these sectors are suffering from extreme inflation, high interest rates and the resulting economic decline in demand. For the copper price, of course, this also means no exuberant scarcity at present, and thus falling prices from USD 10,000 to around USD 7,500. **As with all commodities, timing in the economic cycle is the decisive determinant for investment success.

    Kodiak Copper - It is the long-term view that counts here

    **For the Canadian copper explorer Kodiak Copper (KDK), the current copper price is not decisive on the war, because the Company is fully financed for its current drilling program in British Columbia and does not yet have to offer its own copper on the commodity markets. However, the financial conditions are not the best at the moment either, which puts the shares of the so-called junior under strong pressure. Within an adverse stock market climate and burdened industry trends, the Kodiak Copper share thus also got caught in the downward vortex. However, a significant countermovement has been underway for a few days, leaving the sell-off level at CAD 0.50 clearly behind again.

    Investors should look courageously beyond the coming economic dip because the long-term prospects for copper are excellent. The upcoming investments in infrastructure, digitalization, energy transition and the increasing number of electric vehicles will drive copper demand. One also considers the extensive reconstruction of the destruction in the current war zones. Currently producing mines have even adjusted their production slightly downwards due to falling surpluses, because the general conditions make this appear commercially sensible. But since there have long been too few mines capable of production to meet the coming demand from 2024/25, the market is turning its attention to interesting properties that can come into production in the next few years. Kodiak Copper owns the MPD copper-gold project in the high-yield Quesnel Trough in south-central British Columbia, Canada. A project that is progressing very well, step by step, and was started by Great Bear founder Chris Taylor. Kodiak's strategic focus is on copper porphyry exploration in North America, this includes the Mohave copper-molybdenum-silver porphyry project in Arizona.

    In September of this year, there were results from 5 holes of the 25,000m 2022 drill program at the MPD project in southern British Columbia. The Company's initial work focused on additional drilling in the Gate Zone and testing similar geophysical targets nearby. The new high-grade copper-gold-silver intercepts reported here fill a 170m gap at the southern end of Gate. In addition, drilling northeast of Gate has identified a 400m long parallel mineralized trend in the nearby Prime Zone.

    CEO Claudia Tornquist states: "We commenced testing geophysical targets with coincident copper-in-soil signatures in the wider area around the Gate Zone and are pleased we were able to delineate a parallel mineralized trend at the Prime Zone." This is excellent news for the Kodiak share. It reversed on the heels and returned to levels around CAD 0.68. This values the project at a low CAD 37.8 million. The music plays here in the long term and blows audibly to an entry.

    Porsche, Nio or BYD - Who will make the E-race in Europe?

    What about the prospects of vehicle manufacturers in Europe? With the Paris Motor Show, BYD (Build Your Dreams) is coming to Europe with three completely new, all-electric vehicles. BYD is the world's leading manufacturer of vehicles with alternative drive concepts and performance batteries, its innovative and technologically advanced electric car range speaks for itself and they are priced very attractively for European customers. These include the BYD ATTO 3, a C-segment SUV designed specifically for European customers, the BYD Tang, a 7-seater with variable all-wheel drive, and the sleek and sporty BYD Han sedan. **All prices undercut the European reference models, in some cases, significantly.

    Chinese competitor Nio has a unique concept and is initially bringing three e-cars to Europe. In addition to battery swap stations, they also want to build their own charging infrastructure. Unlike the German carmakers, Nio is taking a unique approach and has developed its own charging station, the power of which is enormous compared to conventional systems. **It is said to deliver 500 kW at 650 amperes, which puts it in the shade of everything that has been seen on the charging station market so far. Most DC fast charging stations in Germany currently only have a maximum charging capacity of 360 kW. That would be a real competitive advantage, but the question is where the necessary energy for such projects is supposed to come from, especially in electricity-poor Germany. It will be interesting to see how Nio implements these plans.

    After its successful IPO, Porsche also wants to play a leading role in the e-market. Only recently, the Zuffenhausen-based company sent a 1000 hp E-Taycan onto the racetrack. At least, a corresponding car has been spotted by automotive journalists. It is supposed to compete with the Tesla Model S Plaid, which forces 1,020 horsepower onto the road. But the Lucid Air in the Sapphire Edition, which still belongs to the exotics, also plays in this segment with just under 1,220 hp. The German manufacturers have so far had a hard time with this kind of horsepower in the e-market, as they want to continue selling their tuned combustion engines. The new e-Sprinters will therefore certainly only round off the range upwards and play only a subordinate role in the normal electrification of traffic. However, it also shows that well-heeled buyer groups do not want to forego driving pleasure for the sake of the environment. BYD shares are still in correction mode at around EUR 24 and Nio has halved smoothly to EUR 10 since mid-September. The winner in the sector is the Porsche share, as it gained almost 20% for the first time after the IPO.**

    **The race to win the favor of consumers has only just begun; the only thing that could slow things down is the economic trend, which for many people is postponing planned car purchases until some time in the future. Slightly slowed down by this, e-mobility will nevertheless follow its predefined path. Kodiak Copper has enormous potential for patient investors at the reduced level.

    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") currently hold or hold shares or other financial instruments of the aforementioned companies and speculate on their price developments. In this respect, they intend to sell or acquire shares or other financial instruments of the companies (hereinafter each referred to as a "Transaction"). Transactions may thereby influence the respective price of the shares or other financial instruments of the Company.
    In this respect, there is a concrete conflict of interest in the reporting on the companies.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.
    For this reason, there is also a concrete conflict of interest.
    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    André Will-Laudien

    Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.

    About the author

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