Production Capacity and Technology - Graphjet Technology has developed a patented biomass process to produce artificial graphite and graphene from palm kernel shells, with a production capacity of 10,000 tons of graphite and 60 tons of graphene annually planned for its facility in Malaysia [20][22][23]. - Malaysia produces approximately 5 million tons of palm kernel shells annually, sufficient to yield about 1.67 tons of graphite and 10,000 tons of graphene [22]. - The company produces artificial graphite and graphene from palm seed kernels, achieving a production cost of approximately $4,500 per ton, significantly cheaper than natural and other artificial graphite sources [32]. - The company can produce graphene at a purity level exceeding 99.99% and sell it at $15 per gram, representing over 80% savings compared to the market price of $167 to $450 per gram [33][31]. - Upon completion of the new facility, the projected annual production capacity will increase to approximately 10,000 to 50,000 tons of graphite and 60 to 200 tons of graphene [41]. Market Dynamics and Demand - The global market cost for natural graphite ranges between $8,000 and $11,000 per ton, while artificial graphite is priced around $20,000 per ton [26][27]. - Over 70% of the graphite used in electric vehicles is currently produced in China, highlighting the need for diversification in graphite production [28]. - The demand for lithium-ion batteries is driving the need for spherical graphite, with each electric vehicle requiring approximately 70 kilograms of graphite [27]. - The company believes it can disrupt the graphite and graphene supply chain by providing an alternative source, reducing dependency on suppliers in China, which currently dominate 92% of the market [53]. Financial Agreements and Revenue - The company executed a supply agreement with Toyoda Trike Inc. for $30 million annually, although no revenue was generated in 2023 due to export restrictions from China [25]. - A supply agreement with Toyoda is expected to generate $30 million in revenue for the company, although no revenue was produced in 2023 due to export restrictions from China [38][48]. Growth Strategy and Challenges - The company has not yet made any sales but plans to sample its products to multinational companies for market acceptance [24]. - Graphjet Technology's ability to maintain its Nasdaq listing and achieve revenue growth is uncertain due to its limited operating history and competitive pressures [16][17]. - The company faces risks related to its growth strategy, including the need for continuous investment in research and development and potential challenges in attracting key personnel [17][18]. - The company aims to differentiate itself through quality, price, and sustainability, with plans to invest in research and development and expand its sales and marketing team [40]. Collaborations and Workforce - The company has established collaborations with several universities for research and development, enhancing its technology for producing high-quality graphite and graphene [44][45]. - The company currently employs 20 staff across various departments and aims to expand its workforce as it grows [55]. - The company plans to open its first manufacturing plant in Kuantan, Malaysia, within the next 18 months, with an estimated construction cost of $400 million [56].
Graphjet Technology(GTI) - 2023 Q4 - Annual Report