Sustainability has become more than a buzzword, with more businesses making it either a key consideration or part of their overall business strategy. This includes demand for green solutions like cleaner energy sources in an effort to reduce carbon emissions.
One company that is seeking to capitalise on this trend is Catalist-listed H2G Green (SGX Code: 5AI), where “H2” and “G” stand for “Hydrogen” and “Green Network”, respectively. Founded in 1998, the company was previously known as P5 Capital Holdings before its name change in 2022. The lifestyle segment of its business, which contributed to 91% of the group’s revenue in 2022, focuses on providing luxury home products to both Business-2-Business (B2B) and Business-2-Consumers (B2C). This includes home décor products, sophisticated lighting, and wall coverings from brands such as Molteni & C, Dada, and Jab Anstoetz that are ethically and sustainably sourced.
However, in view of the growing demand for sustainable and cleaner sources of energy, like green hydrogen, H2G Green intends to pivot to the energy business going forward. It seeks to achieve this through its two business units. For instance, the Green Energy Investment Holding (GEIH) is engaged in the development of processing plants for the conversion of non-food cellulous biomass waste into hydrogen and other useful products using advanced pyrolysis technology. While the other business unit, Gashubunited Utility Private Limited (GUPL), specialises in the last-mile distribution of liquefied natural gas (LNG) via tanks and cylinders, which enables commercial and industrial end-users to enjoy lower-cost and cleaner energy sources.
As more businesses make the transition to green practices, demand for cleaner energy sources such as those provided by H2G Green may grow in tandem. Here are 5 things to know about H2G Green if you are interested in the sustainability industry.
Could you elaborate on the products or services that H2G Green provides for its clients.
H2G Green’s business comprises of two segments:
Sustainability – H2G Green offers clean energy and advanced material options for consumers to achieve net-zero ambition through its subsidiaries. GEIH utilises innovative technology to convert waste into Green Hydrogen, advanced biofuels, and synthetic graphite. GasHub supplies Liquefied Natural Gas (LNG) to industrial end-users with advanced technology designed to reduce CO2 emissions or achieve netzero emissions. By replacing traditional power grids, diesel, Liquefied Petroleum Gas (LPG), and town gas, H2G Green’s solutions help to reduce utility bills and promote sustainable energy use.
Lifestyle – The Group’s subsidiary P5 Pte Ltd (P5) provides luxury home products that are ethically and sustainably sourced. These include contemporary designer furniture and décor, modern and sophisticated lighting, wall coverings, and home accessories. These products offer consumers, who value environmental responsibility and ethical sourcing in their purchasing decisions, with sustainable options.
The Group recently pivoted to new business segments, what can shareholders expect?
Despite currently operating in two business segments, H2G Green is committed to unlocking additional income streams and enhancing shareholder value in response to the growing demand for sustainable investments. As a result, the Group made the strategic decision to pivot towards the Sustainability segment and has made acquisitions to expand its revenue streams and set a foundation for future growth in renewable energy and natural gas.
The acquisition of GEIH has enabled H2G Green to leverage its strengths and create opportunities in renewable energy. The acquisition of GasHub also provides H2G Green with recurring revenue streams and a platform to venture into the growing energy and natural gas-related business on a domestic and international scale.
With these strategic acquisitions, the Group is well-positioned to take advantage of emerging opportunities in the sustainable energy and lifestyle sectors and is poised for continued growth in the years to come.
To what extent is the Group capitalising on new norms and trends that could be game-changers for it in the future?
H2G Green is capitalizing on the growing trend towards sustainable energy consumption and waste management, which could be game-changers for the company. Through its GEIH subsidiaries, the company processes biomass and agriculture waste to produce renewable fuel and support waste management, while also utilizing greener and cleaner sources of fuel like LNG from GasHub to reduce carbon dioxide emissions. This enables H2G Green to offer solutions to challenges related to sustainable sources of energy and reducing carbon footprints.
In addition, the increasing emphasis on Environmental, Social, and Governance (ESG) factors by governments, regulators, investors, and consumers presents several growth opportunities for H2G Green. The trend towards cleaner and/or renewable energy sources and sustainable waste management solutions aligns with H2G Green’s commitment to delivering positive environmental and social impact while providing value to its stakeholders.
Therefore, the company is well-positioned to take advantage of the growth opportunities presented by the trend towards ESG and corporate responsibility.
Could you share some of the key ESG factors that are material to H2G Green and how are you addressing them?
H2G Green is making a two-fold effort to support the transition to sustainable energy consumption and horticulture and agricultural waste management:
First, the Group’s operations involve processing biomass or horticulture and agricultural waste to produce like green hydrogen, advanced biofuel, wastewater to wood vinegar, and synthetic graphite (biochar), all of which are valuable commodities for various industries. This process not only produces renewable energy but also addresses waste management concerns. Moreover, it is carbon negative, meaning that it removes carbon from nature waste and convert it into solid carbon that is embedded in the ground for hundreds of years.
Second, H2G Green uses LNG as a greener, cleaner fuel source compared to coal, diesel, gasoline, and LPG. LNG fuel produces 40% less carbon dioxide than coal and 30% less than oil, making it one of the cleanest fossil fuels available. Additionally, it does not emit soot, dust, or particulates and generates insignificant amounts of harmful compounds.
With many economists predicting a slowing economy and a possible recession in the near term, how is the Group preparing itself to ride out this storm?
While there may be a decrease in demand for the Group’s Lifestyle segment due to slowing consumer demands, the Group expects a contained impact from a slowing economy or possible recession. The Sustainability segment is well-positioned to benefit from such uncertainty by offering a cheaper and greener alternative solution to other fossil fuels. As businesses shift their focus to managing costs, Gashub’s LNG bottled fuel offers a cost-efficient solution that can serve as a catalyst for growth. Therefore, the Group’s focus on expanding its operations in the Sustainability segment can mitigate the impact of a possible economic downturn, and position the company for long-term growth.
Editor’s Note: Some answers for this article were extracted from the SGX 10 in 10 series published on 18 April 2023 and have been republished with permission. You can read more on H2G Green Limited on the SGX website.
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