Forsee Power's Liquidity Surge Signals Investor Confidence in Electromobility's Future

The global shift toward sustainable transport is no longer a distant promise—it's a present-day reality, and Forsee Power (FPR.PA) is proving itself a key beneficiary. New data from the company's liquidity contract reveals a striking surge in trading activity, even as liquidity reserves shrink, suggesting investors are betting big on the French battery specialist's ability to capitalize on rising demand for electric vehicle (EV) systems.

Trading Activity Explodes Amid Efficient Capital Use

Forsee Power's liquidity contract data for Q1 2025 shows a 66% year-over-year (YoY) rise in buy-side executions (637 trades vs. 384 in 2023) and a 107% jump in sell-side activity (506 vs. 244). Even more compelling: the total traded volume hit €582 million in the first half of 2024—up 62% from €359 million in the prior year—despite liquidity reserves dropping to €94,063 as of December 2024, down from €138,974 in mid-2024.

This efficiency is no accident. Forsee has strategically redirected capital toward high-margin segments like heavy-duty batteries for buses and off-highway vehicles, while scaling production at its new Columbus, Ohio plant. The facility, compliant with U.S. “Buy America” regulations, positions the firm to tap into a booming North American market.

Why the Optimism Despite Tighter Liquidity?

The shrinking liquidity account isn't a red flag—it's a sign of disciplined execution. Forsee's cash position fell to €5.4 million in 2024 from €25.9 million in 2023, but this reflects strategic choices: €21.9 million was reinvested in industrial programs, and €10 million in new credit lines were secured to fund growth. Meanwhile, operating cash flow turned positive for the first time (€9.6 million in 2024 vs. -€27.3 million in 2023), thanks to tighter working capital management and renegotiated supplier terms.

The numbers tell a story of a company transitioning from survival mode to profitability. Adjusted EBITDA flipped to positive €0.8 million in 2024, up from -€6.8 million in 2023, while net losses narrowed to -€12.1 million from -€28.0 million. This margin resilience is critical as Forsee expands into markets like rail and commercial vehicles, where higher margins and recurring service contracts (e.g., battery leasing) can amplify returns.

Betting on Electromobility's Long Game

Forsee's focus aligns perfectly with two megatrends: the decarbonization of transport and the shift toward battery-electric vehicles in sectors beyond passenger cars. Heavy-duty vehicles—buses, trucks, and off-road machinery—are among the hardest to electrify, yet they offer the biggest emissions reduction potential. Forsee's expertise in this niche, combined with its Ohio plant's strategic location, positions it to capture U.S. demand as regulators push for stricter emissions standards.

The company's customer diversification is another plus. While sales dipped 29.6% YoY in Q1 2025 due to the expiration of a major contract with Iveco, new partnerships in Asia and Europe are offsetting the loss. The Columbus plant, now operational, can triple production capacity without major new investments, reducing the need for dilutive equity raises.

Risks and the Case for Caution

The path isn't without potholes. Forsee's Q1 2025 sales of €37.1 million were still below 2023 levels, and geopolitical risks—like supply chain disruptions or Asian competitors undercutting prices—loom large. The company also faces delayed North American project timelines, which could pressure 2025 revenue.

But here's why bulls are undeterred: Electromobility isn't a fad. Even with 2025 targets revised downward, Forsee's long-term vision is clear. By 2026, its customer base will be more diversified, its Ohio plant fully ramped up, and its battery leasing and second-life services (e.g., repurposing EV batteries for grid storage) will generate recurring revenue.

The Investment Thesis

Forsee Power is a high-risk, high-reward play on the decarbonization of transport. The liquidity data suggests investors are willing to bet on its execution, even through near-term headwinds. With a market cap of just €200 million and a stock price at €0.50 (down from €1.20 in early 2024), the shares offer asymmetric upside if the company can meet its 2026 growth targets.

For aggressive investors, this is a strategic buy opportunity, particularly as peers like Tesla (TSLA) and CATL (300750.SZ) trade at far higher multiples. The key catalysts to watch: progress on Columbus plant deliveries, new customer wins in rail/bus sectors, and updated guidance in September's half-year results.

In an era where ESG credentials and industrial know-how matter most, Forsee's focus on heavy-duty electromobility—a market that's still in its infancy—could make it a hidden gem in the energy transition.

Bottom line: Investors who can stomach short-term volatility may find Forsee Power a compelling bet on the future of sustainable transport.