First Graphene (ASX:FGR) and the Potential Implications of the Electrification of Transportation

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With the global push to research and develop clean energy technologies, several companies related to the transportation needs of tomorrow — ranging from electric vehicle manufacturers to battery storage facilities — have seen their market valuation jump substantially higher. However, one major factor that impedes mass-scale adoption of cleaner alternatives is cost.

For instance, economies of scale combined with advanced innovations have made lithium-ion batteries for EVs cheaper and more resilient. Nowadays, it’s not out of the question for EVs to approach the range of an equivalent combustion-engine car. Unfortunately, they’re still priced out of the reach of many middle-income households. Even more problematic, there might not be a solution with present technologies.

According to a growing body of research, lithium-ion batteries may be reaching their absolute physical limits. While the thesis is debatable, what’s becoming clear is that we need new solutions to bridge the gap between innovation and economic viability. This is where First Graphene (OTCMKTS:FGPHF, ASX:FGR) enters the frame.

Considered a “wonder material,” graphene is a carbon allotrope with a remarkable physical constitution: it’s essentially two dimensional, with a single layer of atoms arranged in a honeycomb lattice. Further, according to the British Council, graphene is the thinnest material ever discovered. A sheet of graphene is 1,000 times thinner than a strand of human hair yet at the same time is 200 times stronger than steel.

These attributes have significant implications for the development of solid-state batteries. Though blue-chip companies like Toyota (NYSE:TM) have already produced working model SSBs, they remain stuck in the experimental phase. Why? So far, researchers and engineers have yet to address the lifespan issue, as these next-generation batteries tend to fail after only a few charge/discharge cycles.

Obviously, that’s not going to cut it. Where graphene can impart a paradigm shift is in the resilience department. By being able to withstand incredible pressures across an extremely small material base, at scale, graphene can potentially provide the lifespan that SSBs need to be commercially accessible.

Where the investment narrative comes into play for First Graphene is that this organization is miles ahead of the competition. Primarily, graphene remains an unregulated industry, with no real standardization of what constitutes a genuine example of this two-dimensional carbon allotrope. Unfortunately, many fly-by-night boiler room operations put a black eye on the sector.

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But this may also be a blessing in disguise. Just a cursory look at First Graphene’s operations reveals an organization that is constantly forwarding new scientific breakthroughs. As well, FGR has collaborated with some of the biggest names in the mining and materials industry, including BHP Group (NYSE:BHP), Fortescue Metal Group (OTCMKTS:FSUGY) and Rio Tinto(NYSE:RIO).

Finally, the investment community appears to be slowly appreciating the narrative behind First Graphene. After hitting a peak in early January, FGPHF stock began tumbling in sympathy with other graphene-based equity units. Following another mini-rally in the second half of April, First Graphene shares appear to have stabilized around the 20-cent level.

What we may be seeing is a reversion to the mean as investors focus less on the speculative appeal of FGPHF stock and more on its underlying fundamentals. If that turns out to be the case, you’ll want to at least consider exposure to First Graphene as it levers enormous scientific and marketing advantages over its rivals.

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