Seven things every investor needs to know about Applied Graphene Materials
Applied Graphene Materials (AGM) is the world leader in a key graphene technology. The company, listed in the UK and US (LON: AGM / OTCQX: APGMF), appears well-positioned to take advantage of the rapidly transforming market, which is estimated to grow from c $100m in 2020 to exceed $1bn by 2032.
Hailed as a wonder material after its discovery in 2004, almost two decades of hype and little delivery have left graphene languishing in what Gartner calls “the trough of disillusionment”.
The depth and length of that trough has been driven by a technological challenge: the difficulty of incorporating graphene into materials so that its remarkable properties, which include its highly anti-corrosive properties, low permeability, as well as thermal and electrical conductivity, are transferred to the host material. AGM is solving that problem.
Here are seven things every investor should know about the business. For a deeper understanding take a look at Edison’s latest equity analysis.
#1: Moving graphene out of the lab and into the market
Graphene is immensely strong. It is also highly conductive of heat and electricity. AGM stands out from competitors as it supplies graphene in the form of ‘nanoplatelets’ – stacks of atom-thick layers of graphene, which are dispersed in liquid form. The company currently manufactures 45 standard graphene nanoplatelet (GNP) dispersions, for ease of customer use and can also adapt them to specific applications .
#2: Graphene’s commercial age clearly in sight
AGM’s strategy has focused on the global protective coatings market, a sector estimated to have been worth $13.8bn in 2021. Using AGM’s proprietary technology, the company’s customers have been able to incorporate graphene into their products at scale. Significant further growth potential exists for the coatings market and a host of new potential applications are on the horizon.
#3: AGM’s customers include major brands
AGM’s dispersions have, through its customer base, been used in protective industrial coatings for the UK’s Royal Mail, NASA, Network Rail, The Environment Agency, Lidl, Makro, Next and Wickes. In the UK consumer market AGM’s proprietary technology has widespread distribution in products sold via Amazon, Halfords and through direct customer websites.
#4: Meeting the needs of an expanding market
While AGM’s current revenues are largely from the coatings market and composites applications , the widening range of applications for the company’s products include car detailing products and specialty uses . Future applications potentially include battery and energy storage, polymers and composites. With 168 new opportunities in the sales pipeline, the company’s dispersions have potential to be incorporated into composite materials for commercial transport and the aerospace industry.
#5: Realising graphene’s green credentials
The growing adoption of graphene to assist decarbonisation and support the circular economy is already underway. Specific applications for AGM’s products may include composites, energy storage, concrete, and thermal management. AGM’s coatings are being used by England’s Environment Agency. Longer term opportunities include reinforcing pressure storage tanks for the transportation of hydrogen.
#6: The roadmap for sales
The company is focused on incorporating its products into more composite materials for the aviation and aerospace industries and targeting new and potentially significant applications for GNP in the construction, renewables and transport infrastructure sectors. Combining this with growing customer use of its products in the industrial coatings sector, a roadmap emerges.
#7: Global growth: ‘Primer-y’ futures and beyond
In late 2021, AGM launched its own-brand ‘Genable’-branded anti-corrosion primers. In 2022 it plans to scale up its production of dispersions from 10-20 tonnes annually, to around 100 tonnes per year. Having recently signed an exclusive distribution agreement with Indian partner, Imkemex, AGM’s commercial reach now extends directly into South Asia’s liquid resins, industrial protective coatings, composites and polymers sectors.
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