KULR Technology Group (NYSE-AMER: KULR, $KULR) may be consolidating near multi-week lows, but then again, what stock isn't. The now confirmed bear markets are taking down stocks indiscriminately, even those ideally positioned to surge in the back half of 2022, and KULR is one of those. But, KULR's fortunes may soon change.
In fact, with numerous deals inked in the first half of 2022, including a $55 million funding agreement, and having entered into working partnerships with some of the biggest names in their respective industries, KULR is better positioned than at any time in its history to deliver potentially exponential value to investors in the next two quarters.
Moreover, besides the expected operational growth, prior sector coverage indicated detailed how KULR laid the groundwork to streamline production processes and mitigate supply-chain disruptions by moving its manufacturing processes to North America. Additionally, they increased their workforce three-fold and acquired access to a massive cash war chest that should limit downside risk, even in the most bearish market conditions.
Thus, summing those parts makes the KULR investment proposition compelling. And the work done to set up the back half of this year for potentially exponential growth should not go unnoticed or underappreciated.
Making Deals With Global Business Giants
Nor should the deals KULR has and continues to make. It recently announced the finalization of its first contract with one of the world's top multinational technology conglomerates to meet the needs of the burgeoning Metaverse. Through this partnership, the company will be supplying its unnamed client with a proprietary carbon fiber solution essential in producing a core component of experimental nerve sensing technologies.
These groundbreaking nerve sensors are designed to aid navigation through digital interfaces. In other words, KULR can play an essential role in developing novel virtual reality technologies. Better still, demand for specialty products in this sector is soaring and, for all intents and purposes, positions KULR to capitalize on additional massive near and long-term revenue-generating opportunities in a market in infancy.
Furthermore, once this deal is completed, KULR could receive additional deals with this likely billion-dollar client, which could do more than drive revenues higher; they could help establish new market opportunities for KULR to exploit. Indeed, the relationship with this metaverse giant, though unnamed, can't be ignored from a forward-looking perspective, noting that no company in that section has the intention of staying still regarding innovation.
Thus, with KULR on the vendor list, they too can benefit considerably from a continued partnership. In fact, with KULR known to meet and exceed client expectations, it's likely.
There are more deals to appreciate.
Video Link: https://www.youtube.com/embed/cqFtv-RjT0I
Deal With NASA's Artemis Program
KULR also recently inked a new battery safety contract with NASA, where the company will assist in developing parts of the space agency's Artemis program. In its role, KULR will test the lithium-ion cells that make up the battery packs that power the new wave of U.S.-led international human spaceflight endeavors. It's a big contract that could get significantly larger.
Since its signing, KULR has been processing up to 10,000 lithium-ion cells per week. But, the better news is that it led to KULR preparing for a role to test additional KULR-specific applications needed by NASA, the Department of Defense (DoD), and other agencies conducting manned spaceflight programs. It's also a contract that represents the continuation of a highly lucrative and prestigious partnership with the most high-profile space agency in the world.
Moreover, it's a deal that validates KULR's status and position as being of the highest caliber of lithium-ion technologies and services providers. It also strengthens the company's ability to reach outside these government entities and secure deals with the private-sector space exploration companies that are growing mission count at an exponential pace. While NASA may be moving quickly, companies like SpaceX and Blue Origin are accelerating their growth at warp speed, and deals with NASA could open doors there.
There's still more to like.
New DoD Deals For KULR's Carbon Fiber Technology
KULR has also been awarded three contracts with DoD prime contractors to implement their carbon fiber cathode solution in revolutionary new covert weapon technologies. This solution plays an integral role in developing new high-power magnetic and covert pulse weaponry for its clients.
But for KULR, it does more. By contributing to developing these projects on the cutting edge of technological capability, KULR is further cementing its role as the go-to contractor for government agencies and private businesses. Not only has KULR already won three contracts, but the partnerships that KULR is forming with these agencies often turn out to be long-standing and highly lucrative.
Keep in mind that these services and products contracts are far from commodity-based. More importantly, from a KULR and investor's perspective, these specialized, IP-protected projects should keep competitors at a distance. That's another value-creating arrow in the quiver.
However, its most impactful weapon to drive shareholder value could be leveraging its new $55 million funding agreement.
A Massive $55 Million Funding Agreement
KULR recently announced entering a note and standby equity purchase agreement giving them access to up to $55 million in capital. Of course, it goes without saying that those dollars can be leveraged to significantly increase KULR's production capacity, with particular emphasis placed on capitalizing on and maximizing the potential of the lithium-ion battery cells market. That market has seen a surge in demand from the energy storage and e-mobility industries.
That agreement was motivated by soaring demand from KULR's key end markets, which also has KULR positioned to tap into a revenue opportunity estimated above $350 million. Again, KULR has advantages over competitors. The lithium-ion battery cells that KULR produces are exceptionally powerful, with their 500 megawatt-hour capacities holding the energy required to power 40,000 homes using current domestic energy storage options. It's the likely reason investors and lenders committed to such massive funding.
Also important, in addition to facilitating the purchase of additional materials to meet the rising demand for its products, the additional capital has, as noted, enabled KULR to relocate many of its production capabilities to North America. This primarily responds to the recent logistical and supply-line turbulence that threatened even the most securing fastened global companies. The best part of moving a good portion of its production processes to North America is that KULR is minimizing the risks of logistical roadblocks going forward and reducing the costs of its operations. Again, that's excellent news from an investment perspective.
Yes, at the risk of redundancy, more revenue-generating firepower was recently added.
Maritime PPR Technology Opens New Billion-Dollar Market
In Q1, KULR announced a new Passive Propagation Resistant (PPR) solution in its KULR-Tech Safe Case product suite. This new technology is designed to target maritime lithium-ion battery safety applications, an area of opportunity stemming from the U.S. Coast Guard recently releasing new safety requirements for the passenger vessel industry. Currently, KULR's PPR Safe Case technology is one of the only known products of its kind to meet these new guidelines.
More than meeting guidelines, KULR's PPR Safe Case goes further, providing battery safety solutions that prevent thermal runaway, fire, and even battery explosions. The better news is that while the scope of the USCG guidelines targets specific vessels today, its rules are soon expected to expand to include other maritime vessels, including cargo and logistics, commercial fishing, and cruise lines. In other words, KULR may be positioned as the first to market with best-in-class battery safety solutions to meet a multi-billion dollar requirement. That's never the wrong place to be.
The Sweet Spot Of Opportunity In 2H 2022
Frankly, KULR is in several great business places. And with contracts associated with some of the world's foremost names in their industries, its solid competitive position today could get even more fortified. Remember, KULR isn't offering "commodities like" services and products. On the contrary, contracts with NASA, the DoD, Lockheed Martin ($LTM), Leidos ($LDOS), and others working to utilize KULR's proprietary lithium-ion battery and thermal management solutions show that despite its micro-cap price, KULR is in the big leagues of business.
Thus, don't let KULR's roughly $1.50 price fool you. This company is much stronger and better positioned for near and long-term growth than that price indicates. And it's not hard to find proof of that. Major contracts, access to cash, formidable IP, and record-setting revenue growth demonstrate that KULR is not a "wait-and-see" but a "watch-and-see" company.
Therefore, paying attention to KULR today, while markets are soft, could be the conduit to substantial returns once markets normalize. Put more simply, with an arsenal of tools to mitigate risk and accelerate growth, KULR could be a safe-haven stock coiled and ready to surge sooner rather than later.
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