The boom in lithium stocks is overshadowing a broader recovery in the Australian clean technology sector as investor interest in renewable energies builds.
Several lithium explorers and emerging producers have soared this year amid expectations of rising demand for lithium-ion batteries in electric vehicles. Energy-storage technology has become the latest hot sector in renewable energy and sparked renewed interest in global cleantech companies.
After years of heavy losses, Australian cleantech stocks are collectively delivering strong returns and outperforming the sharemarket – a remarkable turnaround for a sector that has had many false starts and been battered by regulatory uncertainty.
The Australian CleanTech (ACT) Index, a barometer of 64 ASX-listed cleantech stocks, has cumulatively returned 36 per cent over three years, about three times better than the S&P/ASX 200 (excluding dividends).
“We are seeing a clear turning point in the listed cleantech sector,” says John O’Brien, managing director of Australian CleanTech and publisher of the ACT index. “It was a question of how far the sector could fall after the global financial crisis and during the Abbott government. The outlook is now the best in some years.”
Smart Investor Weekend analysis of the 30 largest cleantech stocks shows strong price gains.
Lithium producers Galaxy Resources, Orocobre and Neometals have soared amid expectations of rising demand for lithium-ion batteries for electric vehicles.
In Australia, Eco Investor’s Bivell favours waste-management companies and battery-related mining companies, including vanadium producers, which have had less attention compared to lithium explorers. Bivell says organic food producers also have solid long-term prospects as the growing incidence of environmental contamination increases demand for clean food.
Bivell says there are good signs for the development of the listed Australian cleantech sector.
“The sector is a lot larger these days, has several multi-billion-dollar companies and others that pay regular dividends. It’s come a long way in the past few years and has a long way to go yet.” To read more click here.
