A valuation of Nel ASA

Abstract

Capital markets are increasingly paying attention to companies and investment opportunities that address the world’s climate challenges. Environment awareness has become a driver for market value.

In Norway, several companies are shifting their business model to new industries. One of these industries is Hydrogen, which promises to store energy without any associated CO2 emissions.

Nel ASA has been listed for close to a decade on the Oslo Stock Exchange, and during the last few years, it has been one of the fastest moving stocks on the market. This, despite a negative EBITDA and a significant need to raise capital from equity investors.

This paper addresses the fair valuation of Nel ASA. The analysis herein finds that the market value of equity, when taking to account the risks associated with the business, is substantially lower than its current trading price of 18 NOK per share.