GP Batteries International

Apparently the market was abuzzed with the following news:

http://www.investing.com/news/stock-mark...ush-292762

LG Chem Looks To Cash In On China's Electric Car Push
By International Business Times | Stock Markets | Jul 02, 2014 02:33PM GMT | Add a Comment
International Business TimesInternational Business Times

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By Maria Gallucci - As China fights to curb the dirty air engulfing its cities, South Korean manufacturers are looking to cash in on the cleanup by expanding their production of electric car batteries.
LG Chem Looks To Cash In On China's Electric Car PushLG Chem Looks To Cash In On China's Electric Car Push
LG Chemicals (KS:051910) Ltd signed a preliminary agreement on Wednesday to build a rechargeable battery factory in China’s eastern city Nanjing by the end of next year. The battery giant said it plans to invest hundreds of millions of dollars in the plant, which when completed will have the capacity to produce batteries for more than 100,000 electric cars per year, LG Chem said in a statement.
The Korean company will operate the plant in partnership with two Chinese-controlled companies. LG Chem will own half of the joint venture, while the other half will be unevenly divided between the two Nanjing-based firms. LG Chem declined to disclose the total amount of investment by all three parties, Wall Street Journal reported.
The Nanjing plant is expected to generate nearly $1 billion in total sales between 2015 and 2020, LG Chem said.
The battery factory could give LG Chem an early edge in the burgeoning market for emission-free vehicles in China, according to analysts. While demand for electric cars has so far been sluggish in the world’s largest car market, Chinese sales are expected to pick up in the coming years thanks to government targets to put 500,000 plug-in cars on the road by 2015 and 5 million vehicles by 2020.
“[LG Chem’s] expansion into China is positive in that it can gain early access to a potentially huge market, as demand for electric vehicles is expected to take off after 2015,” Lee Ji-Yeon, an analyst at Taurus Securities, told Financial Times.
© Reuters. A Chevrolet Volt electric vehicle is plugged into a charging station.© Reuters. A Chevrolet Volt electric vehicle is plugged into a charging station.
LG Chem’s plant will supply Chinese carmakers such as Saic Motor (SS:600104) and Qoros Auto Co. Ltd. and global auto companies such as General Motors (NYSE:GM) and Renault (PARIS:RENA). The company also makes batteries for electric vehicle models made by Ford Motor Company (NYSE:F), Hyundai Motors (KS:005380)., KIA Motors (KS:000270), and Zhejiang Geely Holding Group Co’s Volvo (ST:VOLVAs), WSJ noted.
The announcement comes just months after Samsung SDI (KS:006400) unveiled a similar battery expansion plan in China. The South Korean manufacturer said in January that it would build a car battery plant in Xi’an by 2015, as well as invest $600 million in the joint project with a local partner over the next five years, Financial Times said. Samsung SDI provides batteries for Chrysler and BMW’s electric car models, and has partnered with Ford to develop new plug-in battery technologies.
Tesla Motors Inc (NASDAQ:TSLA), the darling of electric car fans and founded by entrepreneur Elon Musk, also has plans for a proposed battery “gigafactory,” though it hasn’t decided yet where to build it. Japanese firm Panasonic Corp. (TOKYO:6752) in May signed a letter of intent to participate in building the factory, which could cost as much as $5 billion and allow Tesla to sell as many as 500,000 cars a year.

Japanese listed Micromix rallied on the news while China BAK jumped 41% overnight:

http://www.thestreet.com/story/12764069/...today.html

Why China BAK Battery (CBAK) Stock Hit a One-Year High Today
BY Andrew MeolaFollow| 07/02/14 - 01:06 PM EDT
CommentLink
Find out if (CBAK) is in Cramer's Portfolio.
NEW YORK (TheStreet) -- China BAK Battery (CBAK_) soared to a new 52-week high of $5 on Wednesday after South Korea's LG Chem said it would invest hundreds of millions of dollars to build an electric car factory in China, according to The Wall Street Journal.

The company plans to invest the amount by 2020. The plant will have a yearly production capacity of batteries for more than 100,000 electric vehicles when it is built by the end of 2015, according to LG Chem's statement.

China Bak Battery, which manufactures lithium-based battery cells, could benefit from LG Chem's plan to revitalize the worldwide growth of zero-emission vehicles by starting in the world's largest car market.

However, the biggest irony here lies in that GPB has fully written off the electric vehicle related investments and any rally in GPB based on the above news appear puzzling...

GPB's are electric scooters. The popular ones(Tesla) are electric cars.

There are huge differences.

Very tempted to sell having made a 33% paper profit, but there is no other credible company which is selling for a fcf yield of 16% on the sgx. Need to resist the urge to needlessly sell

Gpi has continued its share buyback of gpb shares. Interesting ly the price it paid exceeds my expectations. Just curious why don't Gpi mount a takeover offer, it save them money than slowly buying shares

(04-07-2014, 09:14 PM)CY09 Wrote: Gpi has continued its share buyback of gpb shares. Interesting ly the price it paid exceeds my expectations. Just curious why don't Gpi mount a takeover offer, it save them money than slowly buying shares

So long as they buy, they are sending positive signals to the mkt.

YTD they bought 6.817m shares @ 0.59532.

Vested
GG

The current share price of GP Batteries is almost half of the net asset value. Maybe we will see more upward movement.

GP Industries 2013 Annual Report Wrote:The market value of the Group’s and the Company’s investment in GP Batteries was lower than its corresponding carrying value in the Group’s and the Company’s financial statements as at 31 March 2013 and 2012. Management considered that such market values did not reflect GP Batteries’ fair value to the Group and the Company, but instead the Group’s share of GP Batteries’ net asset value represented a fairer reflection of the recoverable amount. Accordingly, no impairment loss allowance was required as at 31 March 2013 and 2012.

http://infopub.sgx.com/FileOpen/GPInd_pu...eID=304454

Still buying today - 51k @ 0.735

http://infopub.sgx.com/FileOpen/GPInd_pu...eID=304753

Still in the market accumulating.

YTD avg stands at 7.039m @ 0.60006.

Vested
GG

(09-07-2014, 07:26 PM)greengiraffe Wrote: http://infopub.sgx.com/FileOpen/GPInd_pu...eID=304753

Still in the market accumulating.

YTD avg stands at 7.039m @ 0.60006.

Vested
GG

They have a different number.
7,365,000 shares acquired
HK$27.1m spent
(as of 07 Jul 2014)

http://www.hkexnews.hk/listedco/listcone...707947.pdf

Will graphite prices cause another dent in GPB cost of production?

Solar sparks rush for graphite
THE AUSTRALIAN JULY 11, 2014 12:00AM

Matt Chambers

Resources Reporter
Melbourne

THE promise of mass production from new battery plants is prompting an unprecedented rush for stocks linked to mining of graphite — a key component in small, dense batteries able to store more power for electric cars and houses.

Heightened focus on what could be game-changing battery technology for the solar and car industries — inspired by Tesla electric car founder Elon Musk’s planned $US5 billion ($5.3bn) “giga-battery” factory in the US — has seen a new boom in graphite stocks.

The excited state of the sector was in full effect yesterday, when graphite market leader Syrah Resources’ shares surged on a report that Swiss trader and miner Glencore had made an “informal approach” to the company. The online report of what would be a potential 200 per cent premium offer was neither confirmed nor denied by Syrah nor Glencore.

But despite industry scepticism, the speculation lifted almost all the growing number of graphite stocks on the Australian Securities Exchange, already the mining sector’s best performers for the year. Syrah, whose Balama deposit in Mozambique is regarded as the world’s biggest, finished 28 per cent higher, giving it a market value of $892 million.

The company told the ASX it received approaches from time to time but these had not resulted in any indicative or formal offers.

The growing sense that improved technology in the lithium-ion batteries that use graphite will spur increased electric car and stationary battery demand has sent investors looking for the next Syrah. Gresham advisory says that of the four Australian resources stocks that have shown the most market value growth in the first half of the year, three are graphite-focused.

These are Lamboo Resources, the first local stock to lock in a supply contract with a Chinese firm, with its stock up 367 per cent; Talga Resources, up 512 per cent; and Triton Resources (which has a deposit near Syrah’s), up a whopping 796 per cent. This year, Syrah stock has jumped 77 per cent — but it is more than 37 times the value it was at the start of 2012.

Credit Suisse analyst Adnan Kucukalic said potential growth in battery use would be enormous as technology increased.

“The application for energy storage extends well beyond the car industry and the consequences are far-reaching,” said Mr Kucukalic, who recently went to China to investigate electric car battery making. “Battery technology, in our view, is on the cusp of commercial use in electric vehicles and general mass energy storage.”

Investment advisers pushing the battery growth potential of graphite stocks are focused chiefly on demand from the electric car industry, where Canaccord Genuity analysts say the industry has plans to increase the number of cars, each with a 300kg lithium-ion battery, from about 700,000 this year to 20 million by 2020.

But the solar industry also sees the lithium-ion batteries that use graphite as game changers.

“The change for the electric vehicle industry has been compact, efficient, dense and very safe battery storage, which is perfect for integration with solar photovoltaic systems,” said John Grimes, chief executive of the Australian Solar Council.

“There has been a massive spin-off from this in that we’re seeing the price of these lithium-ion batteries come down, with most consultants predicting a halving of costs between now and 2020.”

The council’s view was that that would probably happen by 2018, Mr Grimes added.

Current battery prices of about $600 per kilowatt hour mean the cost for a battery that can power the average Australian household is about $9000.

Growing battery use is not the only source of the excitement around graphite.

China, the world’s biggest supplier of lower-quality graphite used for refractories in metal production and ceramics, is closing down mines as a move to control pollution.

PAC Partners analyst Andrew Shearer said investors needed to be careful.

“There is an underlying demand for graphite sources outside of China and there is potential growth emergence of the battery market,” Mr Shearer said.

“But graphite is a common mineral and there are a lot of ­junior companies looking for it and there is, without the emergence of more battery use, only ­finite demand.”

Graphite quality is also hard to gauge just by reading the grade of a deposit. Buyers place a high premium on the ability to easily remove impurities from the graphite, meaning those with a committed buyer should probably be treated as a premium stock.

The other chief ingredients in the manufacture of lithium-ion batteries are nickel and cobalt.

To this end, Mr Kucukalic says West Australian nickel and cobalt miner Western Areas, whose shares closed yesterday at a two-year high, are a good way to play the market.

Increased electric car use would also see increased demand for aluminium, which makes the cars lighter than steel. That could be good news for the likes of Alumina and Rio Tinto.