This morning a PR was released highlighting Hypersolar’s recent inclusion in an article in Nature Magazine. The article focuses on the Joint Center For Artificial Photosynthesis (JCAP) and their efforts to make Hydrogen and other fuels from Photosynthesis. What is important for investors in Hypersolar to know is that the interest in what JCAP is doing is significant and extends to public, private and non-profit companies alike. JCAP has received funding in the amount of $116M over five years from the U.S. Department of Energy. In case anyone needed a little validation about what is going into this quest for the holy grail this is but one example. What should be becoming painfully obvious is that Hypersolar could receive grants or investments (as we have stated multiple times before in previous articles and comments) on the order of ten or tens of millions. If one reads the linked article above it appears that HYSR and JCAP are pursuing some of the same lines of research only one of them has 80 scientists working on it and the other just a few. We cannot imagine that HYSR is not applying for some of these grants, nor can we imagine that they are not in conversations with some of the bigger players in the fuel cell industry.
What could PLUG, FCEL, BLDP and others stand to gain from Hypersolar? While we cannot be certain company officials from any of these entities are reading this blog, we do note that about a dozen private equity groups and hedge funds are subscribers here. What we can say without reservation is that a little investment in Hypersolar could be very meaningful. For those just getting current on Hypersolar’s story we state a few things that we think are most critical to know about the company. As the Nature article reveals, Hypersolar is attaining its Hydrogen extraction through renewable, low cost, materials such as waste water. The significance here is that when you get to a mass production extraction level it does no good if the financial equation makes it non-viable. Hypersolar has only pursued an extraction model that makes sense economically and environmentally because otherwise what’s the point. As Hypersolar has oft repeated the voltage necessary to achieve Hydrogen extraction on a commercial scale is 1.5V. Hypersolar in early February announced it had achieved 1.2V. The level needed for Hydrogen extraction is 1.23V. In each of its recent updates HYSR has moved 10% further. So the next move is quite important as we fully expect the company to move past the Hydrogen extraction level. If that doesn’t wake up larger companies who would benefit immensely from onsite hydrogen production nothing will. Having onsite hydrogen production, by way of example, would be infinitely more valuable than whatever PLUG stands to gain from its ReliOn purchase (and we are not saying that that lacks merit).
As I think many investors will come to see in the near future, an investment of $1-5M in Hypersolar would provide whatever company that makes that purchase considerable near term benefit (both practically and on the PR front) and would do so on the cheap. We note that tomorrow marks four months since Hypersolar’s last voltage update. The last two updates were three and two months apart respectively. Our guess (and it is a guess because it is hard to put a timetable on the science) is that we will hear from the company before the six month mark. It could be next week or it could be in August. The commentary in Nature Magazine is certainly validating for Hypersolar and provides a unique boon because it is a publication aimed largely at scientists and/or those significantly interested in the latest developments and breakthroughs. Nature boasts a readership of 424,000 according to Wikipedia. In 2010 it was recognized as the world’s most cited scientific publication by Journal Citation Reports. As always please do your own due diligence and do not rely solely on us or any other source for your investment decisions. Instead consult a trusted financial adviser before making any purchase of equities.