Assuming that:
Or did some of the numbers go completely wrong?
As one might expect, a very interesting, but also tightly priced offering (if the market value after listing would be around 300 million). For comparison, Zaptec’s P/S, for example, is 10.6 based on this year’s forecasts.
I need to continue researching. I would definitely be interested in subscribing, even if the valuation is tight.
edit: It’s also good to add that these companies are not 100% direct comparables and competitors, as one focuses on AC and the other on DC-type chargers. Also, Kempower apparently does not have a payment system service like Zaptec’s 365 Charge? This would be a small minus in my opinion, which should, for its part, favor a lower valuation for Kempower when compared to Zaptec.
I don’t fully understand how 365 Charge works, but in Kempower’s case, the end-user’s (i.e., the charger’s) payment goes to the charging provider, for example, to the S Group in ABC charging. Just like with traditional refueling. I don’t see a need for Kempower to have its own payment service system, and I don’t think its absence should be significant in terms of valuation.
Yeah, maybe I expressed myself a bit poorly. I don’t think it’s necessary for Kempower itself to own a similar service. Nor should it greatly affect its valuation.
However, I do see that a small premium is being paid for Zaptec due to the growth potential of its Charge 365. Kempower lacks a similar “additional option.”
They are not competitors at all if one offers AC charging and the other DC charging. Kempower’s thing is precisely modular DC chargers and the satellites connected to them with sophisticated load sharing. Kempower’s power supplies charge not only passenger cars but also heavy equipment and work machines. Completely different products, a bit like comparing a butter knife to a toaster.
Kempower’s virtual company presentation on Dec 2 at 6:00 PM
Videos about Kempower chargers:
https://www.youtube.com/watch?v=EmuIolKO0qo&t=19s (in English)
https://www.youtube.com/watch?v=a8h1zRSI6eI (in Finnish)
You can find a lot more on YouTube.
Q1-3 revenue was approx. €19M, slightly extrapolating, full-year revenue would be approx. €26M. The valuation P/S would be approx. 11.8. EV/S would be slightly higher at 12.1 with a roughly estimated result for this year. This is assuming the valuation is approx. €219 + €87M.
Targets 4-6 years ahead: revenue of €200M in 2026 and an operational EBIT of €20M (10% profitability target). The P/S looking 5 years ahead would already be around 1.5, and EV/S in the same range. The valuation level doesn’t seem exorbitantly priced after a 2-minute review, but it can’t be called cheap either. The IPO is interesting, but I wouldn’t see much room for stretching the valuation multiples.
For comparison, Zaptec could be used, but the companies do not compete for the same customers.
Zaptec’s owned Charge365 receives 15% of the chargers’ output, which is quite small at the moment, but the operation is highly scalable. Kempower does not have this growth option.
For comparison: Zaptec’s EV/S 2021 is 9.9 and with earnings forecasts, it drops to 3.8 in 2023.
While Zaptec and Kempower manufacture different types of chargers and their strategies are somewhat different, I disagree that the companies don’t compete at all. Both also supply chargers for public use. Some prefer AC chargers and some prefer DC chargers. Not everyone fills their petrol car with 95 octane, some use 98.
I haven’t seen Zaptec’s chargers myself, so I don’t know where they are used. In contrast, I have used Kempower many times.
However, when an operator acquires these chargers, they usually get them from the same place. For example, ABC or Prisma’s parking lot could have 3 CCS (DC), 1 Chademo (DC), and 2 Type 2 (AC) chargers, all supplied by Kempower. Zaptec, on the other hand, could not participate in this competition if it only manufactures AC chargers. Moreover, Type 2 chargers are only for plug-in hybrids, and their need in commercial parking lots will eventually decrease.
I usually charge my EV at home, but when traveling, I prefer to use CCS. However, at a hotel overnight, I could use a Type 2, because the charging speed doesn’t matter then; at 11kW, I can get a full battery overnight. Again, it makes no sense for a hotel to acquire an expensive CCS charger, only cheaper Type 2s, meaning a hotel could be a Zaptec customer. Also, someone living in a densely populated city could use paid Type 2s (without an actual private parking space).
Buses and other large vehicles are another story.
Me neither. That payment system is just right for hotels, which are not Kempower’s customers, as far as I know. Why not also for housing associations? For fast and rapid chargers, a separate operator (e.g., Virta and Recharge) usually handles the billing.
Plug&Charge is the future; you plug the cable into the car, and the system identifies the user and charges whatever credit card or other account. As I understand it, a similar system is already in use in Teslas.
You can only make fast chargers with DC chargers, as no electric car currently on the market can accept AC power at more than 22 kW. This is due to battery technology; the battery itself is DC. For an electric car to accept AC, the car itself must have an inverter. It is not practical to put a cabinet-sized (expensive) inverter in cars, which is why the figures are what they are, and fast chargers will always be based on DC.
Shopping malls and Prismo (supermarket chain) specifically have mainly 22kW chargers, at least in the ones I frequent. PHEVs, however, do not benefit from 22kW chargers, as a PHEV cannot draw power at such a high rate. Most PHEVs only accept 16A single-phase current, which results in a charging power of approximately 3.7kW (16A x 230V). Some PHEVs can also take three-phase current as “fast charging,” but even that does not require a 22kW charger. For example, my PHEV gets a maximum of 11kW charging with Chademo (3 x 16A x 230V).
Zaptec chargers are not yet very common in Finland, but they are indeed in places where the car is parked for a long time by default, such as apartment buildings, detached houses, private garages, workplace parking lots, etc., where charging speed is not as important.
At service stations, people usually stop quickly, so there is certainly demand for fast chargers. No one takes a 4-hour charging break at an ABC (service station chain) on a trip to Lapland. For this reason, for example, ABC should install CCS chargers, with which Zaptec does not compete. Fast charging consumes the battery a bit more, so in everyday use, a 22kW charger is well suited for charging an electric car, for example, during a shopping trip to Prisma. The intention there is not to charge the battery from empty to full.
Lidl’s parking lot, however, has charging stations with fast charging (CCS, Type 2, and Chademo, one of each).
That’s true. It’s because of the power of the car’s onboard charger. The latest Teslas and Renault Zoes can take 22kW of power, many others 7-11kW.
This link explains it better.
I still don’t see the point of having CCS or other fast charging spots everywhere.
Aren’t charging points being built for the future? Current cars are quite rudimentary. Development will likely lead to higher currents being possible and necessary. Driving needs to evolve a lot for usability to meet needs and current motoring standards. When I refuel my car in 5 minutes, I can travel over 900 km. Until electricity or similar offers something close, without a 100,000 price tag, and the device matches current towing and propulsion capabilities, I am ready to put my Diesel in a museum.
Kempower also has a cloud service in all the chargers it sells, although I haven’t yet looked into how much money it brings in.
My view is that AC charging will remain the primary charging method for home/workplace use in the future. DC charging is what large shopping centers and gas stations will invest in. CHAdeMO is also DC charging 
The potential for added value is in services. The most advanced charging points are connected to remote monitoring and/or control, I would assume there’s some potential there.
DC charging bypasses the car’s onboard charger and is known as “fast charging”. AC is probably easier to arrange as a so-called “cheaper option”. These are greatly limited by amperes and the electrical industry, and charging is highly regulated for safety reasons. A quick read of the certificates and directives quickly feels like a hindrance to growth.
For many, home charging is the sensible option, with the car warm and the battery full when leaving. Schuko is slow.
According to the Centre for the Promotion of Electrical Engineering and Energy Efficiency (STEK), household sockets are not designed to withstand large and continuous currents, so acquiring a fixed charging station is recommended.
There is probably demand for this. Although we talk about a charging station, it’s about power transfer. My own knowledge isn’t enough to consider the technical level of Kempower vs. others.
Kempower stated in their press conference that at this stage of the business, the revenue generated by the cloud service ChargEye is not significant. ChargEye operates on a SaaS (Software as a Service) model, apparently with a monthly fee. I believe its importance in customer use will grow as the number of charging fields managed by customers increases, which will also enable revenue from old equipment sales in the future. Naturally, at this stage, the charging devices supplied by Kempower are still under warranty, but ChargEye can likely be used to handle aftermarket services, such as ordering necessary spare parts.
The above is my own speculation on ChargEye’s operations, mainly based on what I saw in this video: https://www.youtube.com/watch?v=uzDLQ4gIFF4
Positives:
Rides the so-called green electrification megatrend. Builder of electric charging fields, not just charging points for cars, for vehicles on land and water.
Hyperterm collection; Emission reduction. “Fast charging”, Modular, scalable, and flexible product design. Clean mobility. Cleaner and smarter future. 100% carbon neutrality by 2035. Investment efficiency. Global. Scalable and flexible business model.
Modular, scalable, user-friendly, and dynamic solutions. High value-added position in the value chain. Software integration and cloud services.
Competitive advantages…?
Challenges:
Valuation:
Next German government's key climate and energy plans in 2021 coalition agreement | Clean Energy Wire Germany is certainly a big market, so it also relates to Kempower.