RENK, Globex Mining, BYD: The raw materials gap – A threat to defense and e-mobility, An opportunity for miners

RENK – Transmissions for Europe's tank offensive

As a key supplier of defense vehicles, RENK is benefiting directly from the wave of rearmament. The Augsburg-based company supplies high-performance transmissions for almost all leading Western tank models, from the German Leopard 2 and the GTK Boxer to the US Bradley Fighting Vehicle. Demand has literally exploded. In the vehicle segment alone, RENK recently recorded a 404% increase in orders. With a total order backlog of EUR 5 billion, the Company has long-term planning security. The focus is now on expanding capacity. EUR 500 million is being invested in new production lines and research and development.

RENK is undergoing a strategic transformation: "We are now moving from manufacturing to series production," explains CEO Alexander Sagel. The Augsburg plant has already increased its production by 50%, and other locations are being integrated. At the same time, the Company is pushing ahead with diversification through acquisitions, such as Cincinnati Gearing and its entry into the electric drives market. The expansion is following a clear pattern. RENK is leveraging its core competence in precision gear units to establish itself as a system supplier for modern mobility solutions. The operating margin of 17% shows that growth remains profitable.

Despite the strong position, Sagel warns of structural weaknesses in the European industry: "At the same time, consolidation of the European defense industry is essential." RENK is therefore pushing for industry-wide standardization, for example, through initiatives such as the MARTE main tank program. For investors, dependence on the defense sector remains a risk; however, the Company's technological leadership and bulging order book offer solid prospects. With planned annual revenue growth of 15%, RENK is significantly outperforming the industry. Nevertheless, at a current share price of EUR 65.67, the stock is not fundamentally cheap.

Globex Mining – Royalties instead of risk – How the commodity player is doing

Globex Mining takes a different approach to traditional mining companies. Instead of operating mines itself, the Company is building up a broad portfolio of commodity projects, currently comprising 258 properties, mainly in North America. Globex develops these properties in a targeted manner and then grants exploration and mining rights to partner companies. In return, it receives cash payments, share packages, options and, above all, long-term royalties on metal production should production commence. This model minimizes the operational risks for Globex and generates steady income long before a mine even starts production. The partners bear the costs and risks of expensive exploration and development. If the partners run out of money, Globex regains ownership of the projects, along with the new knowledge gained through exploration.

Globex's strategy focuses on raw materials that are essential for future technologies. The portfolio includes not only gold and silver but also highly sought-after metals such as lithium, which is key to electric vehicle batteries, copper, which is officially classified as critical, and antimony, which is essential for the defense industry. In addition, there are also properties with rare earths, nickel, and cobalt. These materials are necessary for electric mobility, renewable energies, and high-tech industries. Globex is thus positioning itself at the forefront of global efforts to secure and diversify supply chains for these critical raw materials.

Activity in the projects remains high. Partner Antimony Resources recently reported promising drill results at a Globex antimony project. High grades of stibnite, an antimony ore, have been identified. Such successes increase the likelihood that projects will be further developed, thereby generating long-term royalties for Globex. At the same time, further payments were received. Agnico Eagle transferred the final installment of CAD 3 million for a gold project, and partners such as Renforth Resources and Manganese X made contractually agreed advance payments for their projects. These cash flows, which are independent of the start of production at individual mines, highlight the strength of the business model. The share price rose significantly at the beginning of the year and has been trading sideways since then. The share currently costs CAD 1.37.

BYD – Growth in full swing, but with a bumpy foundation

BYD continues to forge ahead. In the first half of 2025, 2.15 million electric and hybrid vehicles rolled off the production line – an increase of 33%. Exports are booming, with a jump of over 230% to 90,000 units in June. New plants, such as the one recently opened in Brazil, are supporting the Company's international presence. Successful models such as the affordable Seagull, with over 51,000 sales in June, and the best-selling Song are driving sales. However, not all expansion plans are running smoothly. A major project in Mexico has been put on hold for the time being due to geopolitical tensions.

In terms of numbers, things are going brilliantly. Revenue and profits climbed sharply in 2024, by 29% and 34% respectively, and further jumps are expected for 2025. However, the Chinese market is causing problems. According to experts, a relentless price war, growing inventories, and the threat of market consolidation are likely to lead to a decline from over 120 to around 15 manufacturers by 2030. The German newspaper Bild recently reported on large electric vehicle graveyards. This is reflected in the share price, which has lost around a quarter of its value since May. High equity ratios and substantial cash reserves do provide a buffer, but margins remain in focus.

How is BYD coping with the pressure? The key lies in deep vertical integration. The Company produces much of its own components, from batteries to chips. This protects it from supply chain problems and gives it leeway in the price war. At the same time, enormous sums are being invested in development. New business areas such as energy storage and SkyRail monorails are expanding the portfolio. Despite setbacks such as those in Mexico, the global course remains clear. The export share is set to rise to 50% in the long term. For investors, BYD is a powerhouse with clear strengths, but also noticeable bumps in the fast lane. The share price is currently EUR 13.135.

The scarcity of raw materials is at the heart of the industrial future. As a technology leader in tank transmissions, RENK is benefiting from the wave of rearmament, but is struggling with structural inefficiencies in the European defense industry and a high valuation. Globex Mining is leveraging its innovative royalty model to capitalize on strategic demand for raw materials, mitigating risk, particularly in emerging fields such as future technologies. BYD is showing strength with massive growth and vertical integration, but is under pressure in its home market due to brutal price wars and the threat of market consolidation. Its expansion into Mexico has also been put on hold for the time being.