Hydrogenics Corporation (USA) (NASDAQ:HYGS), a leading developer and manufacturer of hydrogen generation technology and hydrogen fuel cell power modules, today announced that it has entered into a strategic partnership agreement with SinoHytec, a vehicle propulsion technology company based in Beijing, for the delivery of fuel cells in China. The agreement consists of fuel cell power module co-development and the supply of power systems specifically designed for the Chinese market. The power systems will be integrated into buses and trucks from several leading vehicle manufacturers in China during 2016 and 2017, and the total value of the contract is approximately $13.5 million.
Over the past few years Hydrogenics has supplied multiple fuel cell systems to SinoHytec for vehicle prototypes, including buses and trucks for various Chinese OEMs. These manufacturers are moving forward with fuel cell mobility programs with SinoHytec as its chosen system integrator.
Hydrogenics’ CEO, Daryl Wilson, said, “China’s strong commitment and leadership in tackling air quality continues to drive interest in hydrogen zero-emission transportation for its leading cities today. Hydrogenics is the clear choice for this initiative due to the compelling and unique advantage that our fuel cell technology brings versus the competition, and Hydrogenics is the only ‘one stop shop’ providing the full scope of applications needed to meet China’s requirements – from Power-to-Gas energy storage to fueling stations and vehicle propulsion systems. Hydrogenics is dedicated to helping customers accelerate their shift to a cleaner, smarter form of power.”
SinoHytec’s VP of Sales and Marketing, Min Yu, stated, “We have worked with Hydrogenics for several years now and thoroughly assessed their technology advantages. SinoHytec also understands the Chinese fuel cell mobility customers’ requirements. Through a strong co-development effort, SinoHytec and Hydrogenics can deliver a new commercial fuel cell power system product especially designed for our valued customers in China.”
These awards follow the November 2015 announcement that Hydrogenics had signed separate supply agreements with several Chinese electric vehicle integrators to bring its fuel cell and fueling station technology to China as part of the country’s strategy to solve prevalent air quality issues. The deals cover more than 2,000 vehicles over the course of the next 3-5 years. Staged rollouts will follow typical engineering milestones from prototyping, manufacturing, vehicle certification and infrastructure build-out. Based on Chinese proposals, vehicle fuel cell requirements alone over a five year period are forecast to be above $100 million. (Original Source)
Shares of Hydrogenics are up nearly 7% to $8.00 in pre-market trading. HYGS has a 1-year high of $12.08 and a 1-year low of $5.41. The stock’s 50-day moving average is $8.10 and its 200-day moving average is $8.30.
On the ratings front, Roth Capital analyst Craig Irwin reiterated a Buy rating on HYGS, with a price target of $13, in a report issued on May 12. The current price target represents a potential upside of 73.6% from where the stock is currently trading. According to TipRanks.com, Irwin has a yearly average return of -5.0%, a 34.5% success rate, and is ranked #3637 out of 3903 analysts.
Hydrogenics Corp. designs, develops and manufactures hydrogen generation and fuel cell products based on water electrolysis technology and proton exchange membrane technology. It offers expertise for a range of applications, including hydrogen generators for industrial processes and fueling stations; hydrogen fuel cells for electric vehicles, such as urban transit buses, commercial fleets, utility vehicles and electric lift trucks; fuel cell installations for freestanding electrical power plants and UPS systems; and provides solutions for energy storage and transport. The company operates through 2 segments: OnSite Generation and Power Systems.