A shell company has helped Hyzon Motors make its stock exchange début: SPAC (special purpose acquisition company). The current value of the company is approximately US$ 1.7 billion, based on the total number of shares. Hyzon builds trucks that run on hydrogen. The US start-up sees itself as technologically quite advanced, after all, the know-how acquired within the last twenty years by Horizon Fuel Cell Technologies in fuel cell research has now been successfully transferred to the public limited company, which has only existed since 2020.
Only 15 per cent of the issued shares are tradable in free float on the stock exchange. Ten percent of the shares are in the hands of the SPAC initiators. A good US$ 626 million was available to the company after the IPO. On the negative side, early-stage investors such as Blackrock, Fidelity, UBS and others are registering their shares and warrants, which are not yet freely tradable, in order to sell them on the stock exchange bit by bit to the value of up to US$ 557.9 million. At the same time, this increases the share of free float, which is to be welcomed.
Hyzon uses components available on the market (from DAF, among others) to build the special trucks, but concentrates primarily on the drive system and fuel cell and hydrogen management. In addition to a production site in the USA, another is planned in Europe. Some vehicles are already on the roads in Europe and the USA, as well as in Australia – here also FC buses that are being tested in use in high heat conditions.
Hyzon plans to reach an annual capacity of 40,000 commercial vehicles (trucks and buses) by the end of 2025. The company’s statement that it was able to reduce the total weight of the hydrogen storage system by 43 per cent, the costs by as much as 52 per cent and the number of production components by a remarkable 75 per cent is interesting.
In any case, Hyzon is tackling one of the largest first world markets for the use of fuel cells: Commercial vehicles. It is estimated that a global market worth between US$ 1 billion and US$ 30 billion p.a. will be created in 2030. According to a study by McKinsey, the share of hydrogen-powered heavy trucks is expected to rise to over 70 percent by 2050.
Every investor must always be aware of his own risk assessment when investing in shares and also consider a sensible risk diversification. The FC companies and shares mentioned here are small and mid caps, i.e. they are not standard stocks and their volatility is also much higher. This report is not a buy recommendation – without commitment. All information is based on publicly available sources and, as far as assessment is concerned, represents exclusively the personal opinion of the author, who focuses on a medium- and long-term valuation and not on a short-term profit. The author may be in possession of the shares presented here.
Author: Sven Jösting, written August 12th, 2021