Electric Vehicle Market, page-8

Head of Australian trading at Regal Campbell Chambers is homing in on electrification, especially battery technology.

"The global battery market is expected to more than triple over the next 10 years to north of US$130 billion a year," said Chambers. And not just for EVs, but for on and off grid storage as well.

But stock picking in this sector is extremely challenging, said Chambers.

"We aim to maintain a disciplined approach to valuation. In such a hot sector, stocks inevitably get overbought and valuations can become stretched. So, we do our best not to fall in love with stocks, or with a good story, but I must admit, this is never that easy."
That said, the electrification story is incredibly compelling. Chambers points to Morgan Stanley research showing EV sales rising at a projected compound annual growth rate of 17% per annum -- moving from 6.4 million EVs sold this year to nearly 20 million vehicles by 2040.


"What took Tesla, eight years to achieve in terms of production volumes will likely take Toyota, Volkswagen, General Motors and others, a significantly shorter time, maybe by as much as a factor of 10," said Chambers.

4 stocks Regal is playing this theme:

Chalice ASX: CHN "(Chalice), we believe, has discovered a new tier-one green metals province, remarkably, only 60 kilometres east of Perth, which has the potential to become the most significant polymetallic discovery in Australia," he said.

Novonix ASX:NVX "(Novonix) is engaged in a diverse range of battery-related technologies, and is a global leader in producing high-quality synthetic graphite for battery anodes." It also has a collaboration with Tesla.

PPK Group ASX: PPK "(PPK) has made significant progress this year" in research and development. "PPK's subsidiary Li-S Energy, which is developing lithium-sulphur batteries ... a competing technology to the well accepted lithium-ion batteries."

Li-S Energy ASX:LIS launched its IPO this week.