Ann: Fluence wins US$3 million Follow-on Order from Kaitian, page-14

@ywtoh
You hit the nail on the head.

I have never seen anything progress as fast as the Yangtze River (Changjiang) Ecological Environmental Protection Group (Three Gorges Group) before. With the direct support of Xi Jinping and funding from the largest financial institutions in China, the Three Gorges Group is signing a new cooperation agreement each week with different cities and large provincial companies in the 9 provinces and 2 municipalities of the Yangtze River Economic Belt (Zhejiang, Jiangsu, Anhui, Hubei, Jiangxi, Hunan, Sichuan, Yunnan, Guizhou, Shanghai, Chongqing).

Fluence management flagged (in the Q3 Conference Call) that this was the type of opportunity they were excited to have been introduced to through the success of their other partnerships.



These types of opportunities to deal directly with the likes of Three Gorges (and by proxy Xi Jinping), are not accessible to just any company, it is invitation only to get a foot in the door. It must be recognized that Fluence have done some good work to date in the Yangtze River Economic Belt region, with MABR installations in Guizhou (Jinzi), Jiangsu (Jinzi/Wuxi + factory), Hubei (iTEST), Hunan (Kaitian), Anhui (Kaitian), Zhejiang (Tiandi), Sichuan (Guorun).

We cannot count our chickens just yet with the Three Gorges Cooperation, it is still early days in the progress of that relationship. I will like to see what other potential partners/customers for Fluence are revealed in future, as I have seen a few discussions they have had that I am excited about. Some coverage of the Yellow River and Pearl River Deltas would be nice.

Plenty of newsflow out of China to look forward to in 2020, as MABR assembly plants should be completed in Liaoning and Hunan, and we should some orders out of associated partners Huahong (Liaoning) and Kaitian (Hunan) to go with them. Zhejiang Tiandi has been working steadily in the background installing plants. The iTEST marketing through the China Highway Society should start showing some results too with sales outside of Hubei. There should also be 3 greenfield SUBRE plants operational within the next few months (Sichuan, Zhejiang, Liaoning) with scope for further orders.

Fluence definitely punches above its weight. For a sub $190 million USD market cap company to have made a dent in China is quite an achievement, but this is a long game with lots of moving parts. Not necessarily advisable to have been along for this ride if you have a short term perspective or expect a get rich quick scheme, but something is being built in China which has long term potential.

It will be nice if some of the other long awaited projects (Ivory Coast + Mexico) are released from political & financial shackles to allow more noticeable revenue streams to come in from other regions. Hopefully we will see some other pleasant surprises this year (like the 2 large lithium projects) rather than being subjected to more unforeseen delays. SUBRE will likely have a few more headlines too.