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CUPERTINO, CA - Aemetis, Inc. (NASDAQ: AMTX), a company specializing in renewable natural gas and renewable fuels, has announced the reboot of its biodiesel and refined glycerin production at its Indian subsidiary, Universal Biofuels. The local Pollution Control Board gave the green light for operations to restart after a pause for maintenance and a review of air quality standards. According to InvestingPro data, the company, currently valued at $98.47 million, has shown strong revenue growth of 59.51% over the last twelve months, despite operating with thin margins.
Universal Biofuels, which boasts an 80 million gallon per year capacity plant in Kakinada, Andhra Pradesh, has been a significant player in India’s biodiesel industry for over 17 years. The subsidiary reported $112 million in revenues from biodiesel and refined glycerin in the year ended September 2024. This performance comes as the company faces operational challenges, with InvestingPro analysis revealing a gross profit margin of just 0.8% and a concerning current ratio of 0.26, indicating potential liquidity constraints. For deeper insights into Aemetis’s financial health and 10+ additional ProTips, consider exploring InvestingPro’s comprehensive analysis tools.
Eric McAfee, Chairman and CEO of Aemetis, confirmed that the temporary shutdown did not impact the company’s ability to meet delivery commitments, thanks to sufficient inventory produced prior to the halt. He also highlighted the expansion of the plant’s capacity to 80 million gallons per year, which aligns with India’s growing demand for biodiesel in the face of a 25 billion gallon per year petroleum diesel market that contributes to air pollution and health issues.
The Indian government’s National Biofuels Policy, which includes a 5% biodiesel blend, has set the stage for increased production, although currently, only about a 1% blend is in use. Aemetis is poised to fulfill the government’s requirement for more biodiesel capacity, with $58 million of allocations for 2025 delivery already received from government-owned oil marketing companies (OMCs).
Plans for an initial public offering (IPO) of the Universal Biofuels subsidiary are underway, with a new CEO appointed and a CFO with IPO experience soon to be announced. The anticipated IPO funds are expected to facilitate the potential expansion of biodiesel production capacity to more than 200 million gallons per year, meeting the annual demand for 1.2 billion gallons. With the stock currently trading near its 52-week low of $1.80, significantly below its high of $7.03, InvestingPro’s Fair Value analysis suggests the stock may be undervalued, though investors should note the company’s negative EBITDA of -$27.98 million in the last twelve months.
Aemetis’ strategy also involves leveraging policies that could support access to renewable oil feedstocks, including the possibility of importing soybeans from U.S. farmers, which would bolster production volumes in India.
Based on a press release statement, this development reflects Aemetis’ commitment to advancing renewable energy solutions and reducing greenhouse gas emissions, as the company continues to expand its global footprint in the renewable fuels sector. Investors seeking detailed analysis can access Aemetis’s comprehensive Pro Research Report, part of InvestingPro’s coverage of over 1,400 US equities, offering expert insights and actionable intelligence for informed investment decisions.
In other recent news, Aemetis, Inc. has amended its sales agreement with H.C. Wainwright & Co., LLC, allowing for the potential sale of up to $210 million in common stock. This amendment, detailed in an SEC filing, reflects the company’s ongoing efforts to manage its capital. Additionally, Aemetis has successfully sold $13.5 million worth of tax credits, netting $11 million after transaction costs, stemming from the Inflation Reduction Act related to renewable energy projects. The company anticipates generating over $500 million in investment and production tax credits to support various initiatives, including biogas projects and carbon intensity reduction at its ethanol plant.
Aemetis has also received approval from the IRS for Excise Tax Registration, enabling it to claim Section 45Z Production Tax Credits for producing low carbon intensity fuels. This registration marks a significant step in promoting the production of renewable fuels. Furthermore, the company has announced revised compensation packages for its executives, with significant salary increases and one-time bonuses reflecting alignment with strategic objectives. These developments underscore Aemetis’s strategic focus on renewable energy and financial management.
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