Can't quite make up my mind about this one. Into some interesting technology on both graphene and an exciting means of producing green hydrogen that doesn't require electricty generation; so no wind or solar farms needed. Costs of production look likely to be sub $2 if the technology is proven also, so the potential is absolutely enormous if they can bring this in. Risk is mitigated somewhat by their near commercially ready graphene based coatings, with other areas being developed also.
But I've been burned before by boffins with great technology struggling to have good commercial sense. And this concerns me looking at the deal to bring in FFI at what appear to be terms very advatageous to FFI. They describe the technology quite rightly as being potentially transformational to the green hydrogen industry and a real disruptive technology. And the hydrogen market will be huge. Yet the terms to bring in Fortescue did not seem to represent that potential value, even on a risked basis. Were they over excited by their size? Did they look at other candidates? Ceratinly the market considered the deal poor as did I.
However, they still retain a significant stake in something that in the success case will result in huge growth for the company. And hopefully they have learnt something. Certainly the company's board seem to have good commercial backgrounds.
I think in volatile times this company is likely to drop a little further, but I've picked up more for the bottom drawer while accepting some technical risk remains. Their graphene side may bring a few interesting milestones that could drive interest in the meantime, not too many SOI and the uni and management hold a good chunk of the company. And there may be potential to accelerate the technology. If I were an electrolyser producer, I'd be watching this company carefully. With the potential to produce sub $2/ kg green hydrogen more thyan a decade before the larger footprint renewables/electrolyser business does, this could be a massive disruptor, and their technlogy appears to have already come a long way.
But I've been burned before by boffins with great technology struggling to have good commercial sense. And this concerns me looking at the deal to bring in FFI at what appear to be terms very advatageous to FFI. They describe the technology quite rightly as being potentially transformational to the green hydrogen industry and a real disruptive technology. And the hydrogen market will be huge. Yet the terms to bring in Fortescue did not seem to represent that potential value, even on a risked basis. Were they over excited by their size? Did they look at other candidates? Ceratinly the market considered the deal poor as did I.
However, they still retain a significant stake in something that in the success case will result in huge growth for the company. And hopefully they have learnt something. Certainly the company's board seem to have good commercial backgrounds.
I think in volatile times this company is likely to drop a little further, but I've picked up more for the bottom drawer while accepting some technical risk remains. Their graphene side may bring a few interesting milestones that could drive interest in the meantime, not too many SOI and the uni and management hold a good chunk of the company. And there may be potential to accelerate the technology. If I were an electrolyser producer, I'd be watching this company carefully. With the potential to produce sub $2/ kg green hydrogen more thyan a decade before the larger footprint renewables/electrolyser business does, this could be a massive disruptor, and their technlogy appears to have already come a long way.
