Clean power for three-wheelers and two-wingers…
18th November 2021 |
The importance of the COP26 global climate change summit has been well documented here at Frontier Tech Investor and other Southbank Investment Research publications.
One highlight was the government of India’s ambitious commitment to achieving net zero carbon emissions by 2070, which is that country’s first official net zero target.
India has also pledged to reach 450GW of renewable energy capacity by 2030, which is four times its current capacity.
These pledges came as a surprise to many observers, given that India is heavily reliant on fossil fuels and the third largest emitter of carbon dioxide (CO2) after China and the United States.
To achieve all these commitments, the government of India will have to look to the private sector to provide solutions.
We think that this boosts the investment case for Saietta Group (LSE: SED) a Frontier Tech Investor portfolio stock.
Saietta is an engineering company that manufactures electric propulsion motors for the light electric vehicle (EV) market.
In this context, light EVs means two-wheelers such as motorbikes and motor scooters and three-wheelers such as tuk-tuks (motorised rickshaws).
India is home to the largest number of motorbikes in the world (approximately 37 million).
Conventional, fossil fuel-powered, two-wheelers and three-wheelers dominate the roads in much of India and other South and Southeast Asian countries.
For two- and three-wheelers, like cars, there is a shift towards greener, electric-powered alternatives. COP26 indicates that this shift is accelerating.
Saietta is already a key provider of motors for light EVs in India. For instance, it currently has a commercial agreement with Padmini VNA, one of the country’s leading automotive suppliers.
As the shift to light EVs gathers pace, Saietta should be a major beneficiary – and especially in Asian markets. We currently rate Saietta as a BUY. You can find the original recommendation here.
In light of the COP26 talks, we believe that Frontier Tech Investor’s other green energy-centric stocks will benefit. These include:
- AMTE Power (LSE: AMTE) – a provider of specialist battery technology to the automotive, oil and gas, and energy storage industries.
- Rolls-Royce Holdings (LSE: RR) – a manufacturer of sustainable propulsion systems for the transport and energy industries.
- Meggitt (LSE: MGGT) – a provider of component parts and systems for extreme environments.
- Velocys (LSE: VLS) – a supplier of sustainable aviation fuel (SAF) converting biomass and forest residue into fuel used by aircraft.
- Ilika (LSE: IKA) – Ilika an emerging pioneer in solid state battery technology
- EQTEC (LSE: EQT) – a green energy company developing waste to energy technology.
Velocys’ share price – like the planes that the company fuels – recently went skywards.
On 10 November 2021, the company announced that its subsidiary, Velocys Renewables LLC, has entered into an agreement with Southwest Airlines to supply Velocys’ SAF.
In terms of the hard numbers, Southwest Airlines will purchase 219 million gallons of Velocys’ net zero SAF over a 15-year period. The SAF will be produced at the Bayou Fuels biorefinery project in the US state of Mississippi.
The 15-year deal will commence from 2026.
At the same time, Velocys and Southwest Airlines have entered into a strategic partnership, giving future opportunities for Southwest Airlines to purchase fuel from Velocys’ other SAF-producing facilities.
Velocys anticipates that, over its life, the contract could provide “multi-billions” of revenues and offset around 6.5 million tonnes of carbon emissions.
The deal is a huge step for Velocys.
It highlights the commercialisation of the company’s SAF, which is starting to be deployed at scale to some of the biggest airline conglomerates in the world.
Velocys’ share price rose 114.2% from 6.30GBp on 9 November 2021, to 13.5GBp on 11 November 2021 following the deal.
We believe there is further upside to be had for Velocys. However as Velocys is trading well over our buy limit, the stock is a HOLD. Should the stock drop back below its buy limit it will move back to a BUY. You can find the original recommendation here. See the portfolio for the latest advice.
We look forward to seeing what the coming months have in store for all of our green energy stocks, as the talk regarding climate change turns into action.
Breaching copyright
It’s come to our attention that some imbecile going by the username “stevea171” reposted our report on EQTEC in the ADVFN, EQTEC share chat threads last week.
This is not the first time someone’s done this, and it’s worth reminding everyone that to republish our reports in the public domain without express authorisation from us is a serious breach of copyright.
Furthermore, to do it on a platform like ADVFN is a breach of their terms and conditions.
We’ve gone directly to our contacts at ADVFN and are pursuing this matter with more seriousness and attention. It’s one of the most disrespectful actions I can think of, not just to us, but to every subscriber at Frontier Tech Investor.
We know that 99.9% of you would never do such a thing, but it’s the handful of dimwits, you know the type that are a few kangaroos short of a top paddock, that do injustice to the rest of you.
Let’s hope that after we close this particular matter with ADVFN and this particular breach, we won’t see this kind of thing happening again.
Buy list update
Mode Global Holdings (LSE: MODE)
Mode is a payments ecosystem that allows users to pay with and manage digital currencies such as bitcoin.
On 11 November 2021, the company announced a partnership with Payescape, a UK-based payroll provider.
In the deal, Mode will pilot the first ever bitcoin payroll product in the UK.
In other words, Mode will convert a portion of the user’s income into bitcoin, with it being directly deposited into Mode’s bitcoin wallet.
It’s a significant step, that brings bitcoin adoption further into the mainstream in a way that we haven’t yet seen.
In this, Mode is providing seamless access to bitcoin, removing any uncertainty for those people wishing to enter the crypto markets.
Ryan Moore, CEO of Mode, noted:
“Bitcoin Payroll is another step towards breaking down the barriers to mainstream Bitcoin adoption.
“By automating the process of converting monthly pay deductions into Bitcoin, Mode aims to make it easy, convenient and accessible for people in the UK to gain exposure to the asset class.”
As bitcoin popularity and adoption across the world accelerates, we believe Mode will generate further commercial success in line with this.
We reiterate our BUY recommendation on the stock. You can find the original recommendation here.
The Frontier Tech Investor “Top Three”
Sometimes it’s hard to decide on which stocks to invest in from our buy list.
Below is our Frontier Tech Investor “Top Three” section showing three stocks in open BUY positions. If you’re trying to figure out what to invest in next, these are three that we think are a great place to start.
This doesn’t mean our other stocks are no good, this is just a tool to help you spot the next Frontier Tech Investor stock that could be worthy of your consideration.
Ilika (LSE: IKA) – Ilika is emerging as a pioneer in solid state battery technology. In particular, it is shaking up the electric vehicle battery market. Its battery interiors are solid state rather than liquified, providing a charging rate and capacity that its conventional competitors cannot rival. In addition, its batteries are used in wind turbine generators. As such, the company has two routes into the green energy sector, which is at the forefront of investors’ minds following the successful COP26 climate change summit. You can find the original recommendation here.
EQTEC (LSE: EQT) – EQTEC is a unique, green energy company that it setting the standard for sustainable energy production. Its innovative gasification technology can convert up to 50 feedstocks into sustainable energy sources. It plays a pivotal role in reducing methane emissions from rotting waste at landfill sites. This matters because methane can be up to 86 times more potent than carbon dioxide at trapping heat in the atmosphere. As a result, we believe the company has a key role to play in helping policymakers achieve stringent emissions targets in the face of COP26. You can find the original recommendation here.
Mirriad Advertising (LSE: MIRI) – Mirriad Advertising is changing the advertising game. This company has come up with a unique solution that inserts advertising into content after the content has been produced. It boosts opportunities for product placement in films and TV series, which Mirriad Advertising monetises by taking a cut of advertising campaigns. The company is expanding into the most valuable advertising market in the world (the United States). You can find the original recommendation here.
Sam Volkering
Editor, Frontier Tech Investor
Elliott Playle
Junior Analyst, Frontier Tech Investor
