July 17th, 2023 | 07:55 CEST
The hour of the problem solvers: BASF, BYD, dynaCERT
The transformation of industry is not proceeding smoothly. The best example is the recent profit warning from the chemical group BASF. Earlier, Lanxess and the Swiss company Clariant also revised their forecasts. The reason: The economic recovery in the second half of the year is likely to be slower than previously assumed. When the global economy falters, chemical companies are among the first to feel the effects - they produce many important basic materials and are linked to many other industries. Although BASF already sees demand for basic chemicals at a low level that is not expected to decline further, there are no signs of any recovery momentum either.
time to read: 3 minutes
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Author:
Nico Popp
ISIN:
BASF SE NA O.N. | DE000BASF111 , BYD CO. LTD H YC 1 | CNE100000296 , DYNACERT INC. | CA26780A1084
Table of contents:
"[...] 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
Author
Nico Popp
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.
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Frustration at BASF - Jubilation at BYD
The weak growth is hitting companies like BASF in an already difficult phase. The Ludwigshafen-based company is currently converting many processes to be ESG-compliant. With business picking up simultaneously, these investments would be easier. So it looks as if urgent changes must also be accompanied by tough cuts. In recent months, there have been repeated reports about job cuts and restructuring. It has long been clear that BASF sees its future in China. However, this strategy is not free of risks. The market also sees it that way - the share is in a downward trend.
Things are much more positive for BYD - both operationally and in terms of the market. The Company recently reported impressive figures and tripled profits in the first half of the year to around EUR 1.5 billion. During the year, BYD had already replaced VW as the market leader in China. BYD is the leader in electric cars anyway. In Germany, too, more and more customers are showing an interest in BYD vehicles. In addition to lower prices, the Chinese score with all kinds of bells and whistles and a high degree of connectivity. The stock is doing well, and rightly so. In the long term, companies like BYD will likely give many established carmakers a run for their money.
dynaCERT: New order for electrolysers
During the past months, shareholders of dynaCERT have faced a challenging time as the stock price struggled, particularly in the previous year. But in the meantime, it looks like the Company has achieved a breakthrough. At the end of last year, the Company reported orders from the mining industry. In recent weeks, further success stories have been added. dynaCERT's partner, Cipher Neutron, has been securing orders continuously. The latest was an order for AEM electrolysers with a total capacity of 10 MW. The customer is Kuber Group, an infrastructure company based in Ghana. The agreement also calls for collaborating on other hydrogen projects in Africa.
"dynaCERT is pleased to partner with Kuber Group and congratulates Cipher Neutron and its team on the exceptional progress of this technology. This positions Canada, Cipher Neutron and dynaCERT globally as recognized disruptive leaders in the rapidly growing, currently USD 150 billion hydrogen market", commented Jim Payne, President and CEO of dynaCERT. "The world needs the ability to make affordable green hydrogen or high-pressure hydrogen in large quantities in a sustainable way without using environmentally harmful rare earths or precious metals with a product that offers a longer life than current technologies," Payne continues.
dynaCERT: Will CO2 certificates bring a breakthrough?
Many electrolysers currently still require the use of so-called perpetual chemicals, such as PFAS. These substances are about to be banned. Many of these devices also contain large amounts of platinum or rare earths. Since the technology from dynaCERT partner Cipher Neutron does not require these substances, the perspective on the hydrogen growth market is good. The classic business with diesel engine conversion kits should also continue growing: dynaCERT offers telematics software that can document CO2 savings. Currently the Company is still waiting for certification so that customers of dynaCERT can also generate CO2 certificates with the technology. Paired with electrolysers, the dynaCERT and Cipher Neutron duo would then provide solutions supporting industry transformation.
Indeed, companies like BYD serve as excellent examples of those who have strategically focused on the right technology for years. But the situation is not always so clear-cut - many expensive machines still have a long remaining useful life. That is where solution providers, like dynaCERT, come into play. Thanks to their collaboration with Cipher Neutron, the Company is now also benefiting from the boom in hydrogen generation. Both companies are already successful in Central America and Africa. While BYD stock is already bullish, dynaCERT remains a speculative candidate for a comeback.
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