First Berlin Equity Research on 22/02/2024 initiated coverage on MARNA Beteiligungen AG (H2 Core Systems, ISIN: DE000A0H1GY2/ Bloomberg: M5S GR). Analyst Dr. Karsten von Blumenthal placed a BUY rating on the stock, with a EUR 4.10 price target.

H2 Core Systems (H2CS), founded at the end of 2020, is a spin-off from the TC-Hydraulik Group, a successful family business in Heide in northern Germany with more than 35 years of experience in fluid system technology. Based on this experience, H2CS produces modular and scalable hydrogen-based plug & play energy supply solutions in Heide and markets them worldwide. The company manufactures the systems from components such as electrolysers, fuel cells and hydrogen storage systems as well as auxiliary systems such as compressors, dryers and water purifiers. H2CS is also responsible for building Enapter’s AEM Flex 120 electrolyser. Enapter is H2CS’s most important supplier. In the rapidly growing global hydrogen market, we see very good opportunities for H2CS to grow strongly over many years and gradually increase profitability. According to preliminary figures, sales in 2023 totalled just under €5m after around €2m in the previous year. Net profit amounted to €164k (prior year: €68k). For 2024, we anticipate a strong increase in sales to just below €14m. Due to investments in growth, particularly through additional staff, we expect a single-digit EBIT margin in the coming years, but believe that H2CS can achieve 10% in the long term. At the end of 2022, Enapter AG acquired a stake in H2CS (share: 26%). In Q1/2024, H2CS plans to go public via a reverse takeover of MARNA Beteiligungen AG and to issue new shares for around €4.0m at the same time. Many countries around the world support the ramp-up of the hydrogen economy. Over 130 countries, which account for around 90% of global GDP, have adopted net zero strategies. The EU has launched a "Hydrogen Strategy for a Climate Neutral Europe" and the USA is supporting the production of green hydrogen via the "Inflationary Reduction Act". Based on a DCF model, we see the fair post-money value of the share at €4.10. We initiate coverage with a Buy recommendation.