Originally published on December 13th , 2022
ESGFIRE returns since 2018: + 1100 %
ESGFIRE returns year to date 2022: -15 %
NASDAQ returns year to date 2022: – 30.35%
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Portfolio Update short summary for November
We apologize for this delayed portfolio update. Our ambition is to always have our portfolio update ready at the beginning of each month however due to the team being away on different conferences and corporate events we were not able to publish on time. Amongst others we visited our portfolio companies Norditek and Clean Motion.
Starting in early 2023 ESGFIRE plans to give out weekly portfolio updates covering weekly news and press releases for all portfolio companies. Our Monthly portfolio update will still be published at the beginning of each month. We may also change the portfolio development into one listed section and one non public section so it will be more transparent and easy for our readers to track our portfolio progress.
November was a bad month for the listed part of the ESGFIRE portfolio. The public part of the portfolio decreased by over 5 % in value putting the overall portfolio in clear negative territory for the full year of 2022. On the positive note however we were reaffirmed in our belief that our non public investment in Evanesce packaging solutions will be a fantastic success story which may yield somewhere between 12-24 times our original investment. We also saw very positive developments for Fusion Fuel and Compleo.
The portfolio remains 100 % invested at this point. We have seen many former portfolio companies in pre revenue stage decrease in value by more than our own portfolio. The reasons vary however in this new market condition valuations and a well funded business have become increasingly more important than ever before. Capital markets are becoming harsher due to fears of recession and also to try and avoid companies that have no clear path to profitability and/or substantial revenues.
Current ESGFIRE portfolio with Monthly performance for November 2022.
Absolicon – Down 10 %
Unfortunately we have been a bit let down by Absolicon although this is not the fault of management primarily. Management have clearly misjudged the lead time for their frame work agreement partners to build up a sufficient order book in order to purchase a production line. We had expected 1 or more production lines to be sold in 2022 however none is currently to be expected . For 2023 we believe if there is such a “ketchup effect” that the company beleives there could be a potential of 3-4 production lines being sold totalling $20-25 million USD in revenues. Absolicon have signed in total 18 framework agreements and totals a sales pipeline exceeding $120 million USD. One production line should produce one off revenues of 4-5 MUSD and recurrent revenue of 3-4 MUSD annually.
Char Technologies – Up +7 %
Char Technologies recently finished a private placement which gave them gross proceeds of C $4,894,881. The company’s stock has gone down close to 46 % YTD , this downward spiral is likely due to a change of sentiment for growth stocks. The company has communicated a sales pipeline of about 100 MUSD however they struggle to find the financing to proceed with the projects. One challenging aspect for the company is that they require a big ratio of equity for projects, a new way of debt financing would increase their potential leverage.
Earthrenew – No Change
Earthrenew is valued at less than 0,5 X sales for 2022 and we would not be surprised to see the company maybe even turn a small profit on EBITDA level for this year . The ESGFIRE portfolio got smacked for buying more stocks at 30 cents just as the company announced a new private placement.Fundamentals are very sound with increasing revenues however gross margins are a bit worrying. The company expects revenues of 27- 30 MCAD for 2022 and we would be surprised if revenues for 2023 did not exceed 43 MCAD according to their latest investor presentation.
Vicinity Motor Corp –Down 29 % %
Despite announcing huge order of $100 million USD the stock has fallen down to previous lows..
The backlog for the company now is over $200 million USD. We have purchased more shares of the company due the positive tailwinds. The company should be able to perform an EBIT margin of 15-20 % long term. There may be concerns from the market about the company’s ability to deliver as deliveries in the third quarter of 2023 was below expectations. We hope to see management prove the market wrong within shortly.
Fusion Fuel PLC– Up 100 %
We spoke in our last portfolio update on how wrong we thought Fusion Fuel was valued. We hope you doubled down because wow were we proven right. The stock as more than doubled during November having reported several positive news such as grants and contracts. We have a very bullish view on Fusion Fuel.
Compleo Charging Solutions – Up 50 %
After having a turbulent month Compleo management gave a clear path to profitability. For our full analysis on this please read our post by clicking this . We decided to sell our position in Lion E -mobility to double down in Compleo and so far it has paid off.
Norditek Group – No Change
Norditek is a profitable clean tech company active in the mobile recycling industry. They sell, lease or rent sorting plants and inhouse made machines and in this way they recycle materials into sellable products. They mainly handle and recycle materials from construction sites. The company currently according to our estimates (input given from external analyst) is trading at a Price to Earnings ratio (P/E) of 10.3 and given that the company aims to grow at a pace of 15 % per year we think this is tremendously undervalued. After having visited the company in person we think there is little competition on the market and the company’s internal organic growth of 15 % should definately be doable if not exceeded.
Clean motion – Down 20 %
This small Swedish company has a hyper interesting last mile delivery vehicle. There are several peers valued at 10-20 X the market cap of Clean Motion. The company has begun taking orders for their new last mile delivery vehicle which has solar cells on the roof and charges itself! The company currently has capacity for 500 vehicles per year which implies 5-6 MUSD revenues per year however the plan is to scale this up to 5000 vehicles per year before the end of 2023 which equals roughly 50-60 MUSD per year. The stock has had some recent downward pressure to do an options offering where the redemption price was 1,47 SEK. We expect the share price to return to its recent highs when orders start flowig in.
Landi Renzo – Up 10 %
This hydrogen and RNG mobility company is set for massive growth and is extremly undervalued with more than 100 % upside. We recommend you read THIS analysis on the company for more information.
We have an extensive analysis coming out on Landi Renzo in December.
Clean industry solutions Holdings – Down 25 %
Clean Industry Solutions Holding Europe AB invests in companies that provide solutions for sustainable industry and a circular economy. The two subsidiaries, Industrial Solar GmbH and SolarSpring GmbH, offer solutions for the supply of clean energy and clean water for industry. The company is very attractively valued and we see great upside potential as soon as the dust settles after their latest public offering. A new analysis was released today implying over 100 % upside at 3 SEK target price.
Lion E-mobility is developing at an impressive pace, however we had to sell our position atleast temporarily to finance a larger position in Compleo Charging Solutions.
We have chosen to sell this position due to the worrying financing situation for the company. We will await possible solutions for the company to find more working capital before possibly reentering.
The company has had little news lately and since their revenues are yet small and the valuation currently is 9,75 X sales for 2022 and 3,9 X sales for 2023 we have decided to stay on the sidelines for a while to evaluate which direction the company is taking. We may re enter our position.
We have a number of positions in unlisted companies which we anticipate will go public through initial public offerings within the next 6-18 months.
Evanesce packaging solutions
As a sustainable technology innovator,Evansesce is revolutionizing sustainable packaging with 100% compostable and affordable plant-based solutions.
ESGFIRE and those of our readers who invested in the company entered at a valuation of 30 MCAD implying a likely 12-24 X upside to our initial investment.. The company is likely going public in second quarter of 2023 on one of the Canadian stock exchanges.
The vision of Captico2 is to be the world leading in offering high impact Carbon Capture Utilisation and Storage technologies (CCUS). Captico2 can capture mineralize and transform carbon dioxide into a valuable and sellable commodity in less than 60 seconds. The company aims to pre-sell 10 full scale units in 2022 creating potential revenues of 160 million EUR. The company currently has a 500 million USD sales pipeline.
Captico2 is currently negotiating a 10 MUSD Series A financing which will enable them to proceed with their TRL 7 testing. So far out of the 10 MUSD Series A 5 M USD has been comitted by Norwegian VC firm Valinor.After the TRL 7 is finished they have a written order of 10 units totalling 160 million MUSD with a possible EBITDA profit of 50 %. Our calculations imply that the investment could render a wooping 20-35 X our initial investment if things go according to plan based on a 10 X EBITDA projection only for the single order mentioned above.
OLA MEDIA is a network of interactive touch screens located exclusively in the backseat of Ubers. By leveraging innovative technologies and captivating spaces, they help brands create engaging experiences with a high value audience.
Ola Media is currently closing a capital round which implies a 250 % upside for our initial investment. The company is likely going public during the second quarter of 2022 at either Canadian exchanges or NASDAQ.
Alchemy is developing innovative nanocoating solutions to the challenges faced by many industries. Their coatings are designed to repel water, dirt, and ice while maintaining the high transparency, mechanical durability, and weatherability specifications for advanced sensor systems used in harsh environments. The company has a deal with the Canadian army and this may be further increased during this fall which could imply a 3-5 X valuation of our initial investment.
Most likely going public by Q3 -Q4 of 2022 .
The stock price development above was calculated by taking the opening price at the first day of the month and the closing price at the last day of the month.
We own shares of these companies personally.
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