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Canadian battery materials specialist Nano One Materials Corp (NASDAQ:NNOMF) is still attracting interest from investors following its $10 million private placement, which the battery materials tech firm is going to use to fund the expansion of its facilities in  Canada and underwrite further technology development.

Nano One has doubled the size of the private placement due to intense investor interest in the company, which has also seen the share price rise by over 30%. The Armchair Trader first covered the stock on 3 December last year when it was trading at $1.30. It has since reached $1.55, and at time of writing was close to $1.50.

The private placement consists of  8,695,652 units, which are being priced at $1.15 per unit. Nano One is offering the additional shares with plus one half a share as a purchase warrant (which allow holders to pick up an additional share at $1.60 up to 36 months after the issue).

The market seems to be responding well to the issue, but we also note that there is increasing interest in Nano One stock as investors wake up to the fact that the millions of new vehicles the major manufacturers plan to build may need far more efficient batteries than are currently available.

Tesla share price jump evidence of investor interest

The jump in Tesla’s share price (NASDAQ:TSLA), which saw Tesla stock move to a 52 week high of 968.99, is evidence of just how seriously the market is taking the electric vehicle story. While Tesla shares have since dropped on the back of profit taking and concerns about the impact of the coronavirus on its Chinese operations, interest in electric vehicles is intense.

Tesla is already working on a battery venture with Panasonic, which has seen Panasonic awarded the contract to become an exclusive supplier of lithium-ion electric battery cells for the Tesla Model 3. Panasonic has been working closely with Tesla at its Nevada giga-factory.

We like the premise of specialist battery materials, protected by patents, that would allow manufacturers to make batteries that are far more efficient than current battery technology. Nano One itself is a long term energy technology play which is positioned well to take advantage of strategic alliances with major players in next generation vehicular technology.

Strategic relationships will be key for Nano One

Nano One has strategic relationships in place already, for example with Volkswagen Group Research to look at future car battery technology, and Pulead in China, where it is researching lithium ion battery processing. One of the reasons we like this stock is the sheer range of applications for Nano One’s technology.

While Nano One is not able to discuss some of the other partnerships it is working on, CEO Dan Blondal has said that the firm is seeing increased interest from the automotive sector. It owns a patented nanocrystal technology that can improve the durability of lithium cathode materials. Car manufacturers are interested in Nano One’s single crystal cathode technology which allows these cathodes to be produced consistently, something it is very hard to do.

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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