Member Info for Malik-

CEZ's strategic director Pavel Cyrani spoke to Czech press. VERY BULLISH commentary for us.
Recall Cez, the Czech utility, owns 51% of Geomet; the company which owns the Cinovec deposit on Czech side. The remaining 49% of Cinovec is owned by EMH.

“ “Cyrani admits that Deutsche Lithium is farther ahead than Geomet. "However, they are burdened by the fact that one parent company of a German developer went through bankruptcy. We do not race with them, we rather have debates that there would be only one processing plant for the Czech and German deposits, "he says. According to him, it is more probable to build such a plant on the Czech side.””

Hugely positive for economics of our project - savings on processing -plant so capex, and therefore IRR.
Competent I. Line with what we have been arguing.

https://www.google.co.uk/amp/s/www.seznamzpravy.cz/clanek/cez-ma-tezit-nejdulezitejsi-kov-21-stoleti-obejde-se-bez-jedu-167410%3famp=1

Disagree.
Whether there is a takeover or not by Ganfeng, ZNWD simply
cannot trade at 1/5th of valuation of next door neighbour EMH; which shares the same deposit.
The end games whatever the outcome of Ganfeng will be a sale to EMH. Hugely value accretive to EMH shareholders.

So let me recap the investment thesis here:
1) We are the next door neighbour of EMH, sharing the same Cinovec deposit on German side of border - yet we trade at 1/5th the resource multiple of EMH (and that’s before today’s announcement); assuming we buyback Solarworld share - a defunct company. This Solarworld acquisition could land anyday and takes us to 100% ownership of the asset vs EMH owning 49% of theirs. ZNWD shares will double on that announcement.
2) We are 44% owned by Bacanora, who received a takeover offer from Chinese giant Ganfeng. My view is Ganfeng will sell their shares to EMH. We are an obvious takeover candidate.
3) A takeover by EMH, which I am shareholder of, would be up to 70% value accretive to EMH shareholders before any synergies.
4) BIG synergies in consolidating ZNWD and EMH resource - saving on capex and growing IRR.
5) VW a German company is about to decide to sign an agreement for a battery plant 50km away from Cinovec deposit - with Cinovec offtake.
6) We just got an expl license which raises Li resource base by almost 50% at ZNWD. This will dismantle the arguments by those bearish on prospects of takeover on basis of smaller resource.
7) Hydroxide p rose to $14.5k, meaning c40% higher NPVs to Li co resources yet stock not budging.
8) shares not reacting to all this is completely irrational, and makes this a no brainer.

…With new exploration license close to current resource.
Yet ZNWD shares not moving - this AIM market is a complete joke as we know.
This actually makes ZNWD a LOT more attractive to any prospective acquirer - and for me this is an obvious M&A target.

Clearly no one looks at this stock anymore - completely
under the radar.
BUY BUY BUY

With new exploration license close to current resource….
Yet ZNWD shares not moving - this AIM market is a complete joke as we know.
This actually makes ZNWD a LOT more attractive to any prospective acquirer.
You know my take on this story.
EMH&ZNWD are BUYS

New explor license includes JORC Inferred resource of 25Mt @ 0.45% Li2O. Stock totally missing significance of this…
ADDS a SIGNIFICANT c50% to ZNWD’s current LCE resource base!
What’s wrong with this market?

What people are totally missing here. Is that the sales multiple you apply to hydrogen is literally and conservatively 5-10x higher than that the legacy oil&gas business.
In other words, the day Getech announces only £1m/yr hydrogen sales contract - you are looking at something like £8-20m on valuation.
That’s being super conservative on my sales multiple. Hydrogen fuel cell and electrolyser companies trade at 30-40x sales. So that would mean £30-40m on valuation per £1m of revenue.
Say you use a multiple midway between both for a baseline scenario: £20-30m valuation per £1m of revenues. That’s 130-200% of share price for £1m of sales.

https://www.google.com/amp/s/dailybusinessgroup.co.uk/2021/06/logan-energy-in-hydrogen-tie-up-with-element-2/amp/

Our hydrogen partner Element2, just signed an agreement with a firm whose board encompasses the former CEO of utility giant SSE.
Reflects once again that Element2 is a very credible partner for us - as is of course SGN - something which the market is overlooking.

If our friend Rodney Hooper is correct and that Hydroxide prices reach $20k later this year/early next; then expect to be DOUBLING our published NPV (which was based on $12k p).
Then, expect a doubling too of the share price on offtake agreement - so that the valuation multiple matches those of Piedmont.
That’s 4x upside from here.

Valuations are truly ridiculous on this stock.
This is play on UK hydrogen infrastructure, with MoUs with top UK gas network SGN; and Element2 which aims to install H2 refuelling stations in country.

40% of mcap is cash

Yet market is discounting in shares here H2 opportunity at nr ZERO value=> BIG upside & limited downside

https://www.extreme-e.com/en/news/289_Power-in-the-most-remote-locations-on-the-planet

“– in Senegal, AFC Energy delivered its first Hydrogen Production Module which produces hydrogen from water using an electrolyser powered by solar panels. Adam expands: “This green hydrogen is then fed into the hydrogen fuel cell on race day to produce the energy needed to charge the cars. “

Market completely missing this Iran news…
This slight rebound doesn’t even cover for the contract wins.
Again 7.7p just on those. Then add optionality.
We should be heading to 10p+

Stock should be today at 7.7; mathematically.
Without taking into account all the optionality points I mention above.

Tick down is BUYING OPPORTUNITY

From Reuters just now.

MASSIVE positive for the Iran contract!
Stock here should be >30% higher than where it is now on the back of the two contract wins in the last few days (+70% on revs/gross margin). And that’s before any optionality from 1) covid recovery 2) factoring in a doubling of the 6m pa contract as airline traffic recovers and 3) Iran upside.

https://m.youtube.com/watch?v=xkMVZjzOivU

A must watch for anyone looking at this company and hydrogen.
See my other post for my key takes.

Worth reminding the contracts Getech (ex H2Green) won on its legacy assets, since the start of the calendar year. The stock derated post the release of the 2020 full year results last week; and my view this is missing the point of what’s happened since the closing of 2020:
The contract wins since 2021 indeed mirror a rebound of activity vs 2020 annual results; as described by CEO at the company presentation last week.

1) January 2021: +£0.56m contract for their flagship Globe program. That was a huge contract win and not appreciated by the market. Indeed, it compares to a company disclosed order book of £2.7m as at end 2020 (vs £3.1m as at end 2019). This Globe contract was not included in that 2.7m figure, since the contract was won post 2020 closing. Adding it to the 2020 published order book figure; we get a current order book value as it strands today of £3.3m. This is £0.2m higher than end 2019 or +6% higher, and >20% higher than the disclosed 2020 figure. That’s very substantial.

2) April 2021: The company disclosed in RNS, the signing of a new services contract worth existing and new customers worth £375k. This is around >10% of annual revenues. This in itself means the revenue decline witnessed in H2 last year has stopped.

Valuation wise, cash here makes up a significant c40% of market cap.

EU just approved reg for 17bn energy Just Transition Fund. I remember EMH Chairman saying in Crux interview a few months ago, that Cinovec could be eligible to get funding from this vehicle.
Positive.

https://www.powerengineeringint.com/renewables/strategic-development/eu-adopts-e17-billion-just-transition-fund/

Stock now trading at 1/5th of valuation of EMH; as we remain stuck at 13 while EMH re-rates.
The cheaper it gets the more it becomes an salivating takeover candidate.
VW, a German company, going to Czech R to discuss battery plant 50km from Cinovec - and c50km from our resource therefore, in Germany.
What is wrong with this market!!!?