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July 24th, 2023 | 08:00 CEST

SAP, Altech Advanced Materials, Varta AG - Positive surprises

  • Technology
  • Batteries
  • renewableenergies
Photo credits: pixabay.com

The first six months of the stock market year 2023 are already history and have been one of the more successful ones, despite uncertainties due to high inflation rates and growing geopolitical tensions. The German benchmark index DAX alone put in a performance of over 16%. The reporting season for the first half of the year is currently underway. Many companies were able to surprise positively, which should speak for further rising share prices.

time to read: 4 minutes | Author: Stefan Feulner
ISIN: Altech Advanced Materials AG | DE000A31C3Y4 , VARTA AG O.N. | DE000A0TGJ55 , SAP SE O.N. | DE0007164600

Table of contents:


    Uwe Ahrens, Direktor, Altech Advanced Materials AG
    "[...] Silumina Anodes® is a ceramic-coated graphite/silicon anode composite material that we plan to produce in Schwarze Pumpe, Saxony. Here, we aim to supply manufacturers of batteries for e-cars with an application-ready drop-in technology that is low-cost, high-performance and safe. [...]" Uwe Ahrens, Direktor, Altech Advanced Materials AG

    Full interview

     

    Varta AG - From Zero to hero

    The tide can turn so quickly on the stock exchange. After being shunned by the stock market community in May and facing the possibility of a steep decline, the Varta stock has made an impressive comeback since the beginning of June, surging approximately 63% to EUR 22.32. Of course, the badly shaken producer of microbatteries, household batteries, energy storage systems and customer-specific battery solutions is not yet out of the woods, but the market is rewarding the first restructuring successes.

    The Ellwangen-based company signed a comprehensive restructuring agreement with its financing banks and majority shareholder and an amendment to the existing credit terms while maintaining the existing financing until the end of 2026, which creates the basis for further implementation of the restructuring program.

    In addition, further steps were taken at the recently held virtual annual general meeting. Shareholders voted to cancel the existing authorized and conditional capital measures from 2022 and replace them with the creation of new authorized and conditional capital measures, each amounting to 20% of the capital stock. In addition, Günther Apfalter was elected as a new member of the Supervisory Board. He replaces Werner Tillmetz, who resigned as of October 30, 2022.

    Despite the recent successes, an investment in Varta remains a risky venture. Analysts surveyed on Refinitiv see an average price target of EUR 18.00 for the stock.

    Altech Advanced Materials - Too well developed

    Due to its innovative product portfolio in the field of coating technology for new types of batteries as well as grid battery storage, the shares of Altech Advanced Materials have been among the absolute high flyers on the market in recent months. At the beginning of the year, the Altech share, which has also been tradable on Xetra since recently, was quoted at EUR 3.60. In the meantime, the value exploded by around 400% to over EUR 18.

    Due to the powerful jump in the share price, the management team around CEO Uwe Ahrens had to form a "provision for impending losses" of around EUR 518,000 in the preliminary half-year results, resulting in a higher-than-expected loss of EUR 992,000. This is because the option conditions for the convertible bond issued in March and the associated warrants provide for a cash settlement in addition to a share delivery, with the conversion price set at EUR 1.00 at the time.

    Operationally, everything appears to be moving in the right direction at the Heidelberg-based holding company. At least, during the press day scheduled for mid-September at the Schwarze Pumpe Industrial Park, news about the development of highly innovative technologies is expected to be announced.

    Altech Advanced Materials has two aces up its sleeve. Silumina Anodes, a special nanocoating of high-purity aluminum oxide in combination with silicon, significantly reduces the capacity loss in batteries that occurs in conventional lithium-ion batteries. No less promising is the partnership between Altech Advanced Materials, Altech Batteries Ltd. and the renowned Fraunhofer Institute for Ceramic Technologies and Systems IKTS. This cooperation focuses on developing CERENERGY batteries, a solid-state sodium-alumina battery that is to be produced industrially and sold commercially.

    The CERENERGY storage system will eliminate the use of lithium, cobalt, graphite and copper and replace them with common salt and small amounts of nickel. The technology is to be used in stationary energy storage systems for renewable energy sources such as wind, solar and water. Planned production is at Altech's Schwarze Pumpe site in Saxony.

    SAP - Dent in the cloud

    The share of the largest European software group came under powerful pressure at the end of the week. With a minus of more than 6% compared to the previous week, the SAP share went out of the market but regained the strong support area at EUR 120.54 in the trading session.

    The reason for the sell-off was the correction of annual targets after the promising cloud business fell well short of expectations in the second quarter. In the latest estimates, the Walldorf-based company expects cloud revenues to grow between 23% and 24% on a constant currency basis. Earlier estimates predicted growth of between 23% and 26%.

    Compared to the same period last year, they recorded a 19% increase to EUR 3.3 billion in continuing operations. However, analysts' expectations were higher on average. Overall, revenues increased by 5% to EUR 7.6 billion. Adjusted earnings before interest and taxes amounted to EUR 2.06 billion, an increase of 23% compared with the corresponding prior-year quarter. In addition, the Company exceeded analysts' forecasts.

    Following the figures, DZ Bank reiterated its price target of EUR 115 with a "hold" vote. For the US bank JPMorgan, the German software company is considered an "outperformer", but the price target was lowered from EUR 140 to EUR 138.


    After horrendous share price losses, Varta AG continues to tinker with restructuring. SAP suffered a setback in the cloud business. As a result of the sharp rise in the share price, the loss at Altech Advanced Materials was higher due to the formation of a provision for impending losses.


    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.

    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 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

    Stefan Feulner

    The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
    He is passionate about analyzing a wide variety of business models and investigating new trends.

    About the author



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