On Weichai, I unfortunately cannot present any new key figures, but the increased share price indicates that, firstly, things are going well with the hydrogen strategy at China’s largest diesel engine manufacturer and, secondly, China’s expected H2 subsidy program allows for positive estimates here. Joy comes from subsidiary Kion, whose stock market value increased by a good 50 percent. One ponders why Weichai continues to have only 30 to 35 percent of the value with which US competitor Cummins Engine does on the stock market. The two companies are very well comparable, even if the Chinese state is involved in Weichai as a major shareholder.
Weichai maintains through the JV with Ballard Power (51:49) still the largest stack production for trucks and buses in China to date, particularly as Weichai by itself owns subsidiary companies that produce commercial vehicles in addition to heavy equipment (cranes; mining trucks; engines for ships, trains, and so on). If there’s a large H2 subsidy program, they’ll have everything in house – from stack production to applications. Weichai Power is my key investment in China in hydrogen and fuel cells.
Disclaimer
Each investor must always be aware of their own risk when investing in shares and should consider a sensible risk diversification. The FC companies and shares mentioned here are small and mid cap, i.e. they are not standard stocks and their volatility is also much higher. This report is not meant to be viewed as purchase recommendations, and the author holds no liability for your actions. 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 medium- and long-term valuation and not on short-term profit. The author may be in possession of the shares presented here.
Written by Author Sven Jösting, June 9th, 2023
