AFC Energy PLC (AIM:AFC, OTC:AFGYF) shares are a 'buy' with a 50p price target, says broker Liberum in a note following the company's positive update on its cracking technology to improve the combustion and emissions of ammonia-fuelled maritime engines.
AFC said the hydrogen-producing system operated successfully alongside a MAHLE Powertrain engine, primarily fuelled by ammonia, and, using an 80:20 ratio of ammonia to cracked gas, the engine demonstrated improved performance compared to using ammonia alone.
It generated gas on-demand, which, when blended with additional ammonia, provided a stable fuel gas stream to the engine injection system, the company added.
Liberum, in a note to clients, said: "Whilst ammonia cracking is a core part of AFC's two-division tech platform with significant recent progress and opportunity, particularly in marine markets, it does not yet form part of our forecasts or valuation."
In morning trading the stock, up 30% in the last year, was flat at 17.84p.