Why the Nanollose (ASX:NC6) share price is shooting higher today

The Nanollose Ltd (ASX: NC6) share price is rocketing even higher today following a joint patent application with Grasim Industries Limited.

| More on:
miniature rocket breaking out of golden egg representing rocketing share price

Image source: Getty Images

The Nanollose Ltd (ASX: NC6) share price has been on fire the last two days. Yesterday, the company’s shares jumped to more than 52% at market close, following the announcement of a joint patent application with Grasim Industries Limited.

Today, investors further drove up the Nanollose share price after digesting the news, sending it a whopping 82% higher at 14 cents.

Quick take on Nanollose

Based in Australia, Nanollose specialises in researching and developing eco-friendly biomaterial using its microbial cellulose technology. Its proprietary plant-free technology alters the structure of nano cellulose through physical or chemical treatments to create new modified fibres.

The company aims to commercialise the production of its cellulose technology as an environmentally-friendlier alternative to cotton, tree pulp, and other fibres that are used within the textiles industry.

What’s driving the Nanollose share price to massive highs?

In yesterday’s release, Nanollose advised that is has filed a patent application with Grasim for a high tenacity lyocell fibre made from microbial cellulose.

The submission represents a major step forward for the company as it seeks to improve its fibre composites. Nanollose said that a team of fibre specialists at Grasim’s Pulp and Fibre Innovation Centre was producing nullarbor lyocell fibre. This is a revolutionary fibre said to be finer than silk and significantly more durable than conventionally-sourced wood pulp lyocell.

The use of lyocell is increasingly popular in today’s environment with the fibre employed in a number of industry-wide applications. The more expensive cousin of cotton, Lyocell is used in many everyday fabrics. This includes textiles to make clothing such as jeans, towels, and underwear. In addition, the cellulose fibre is used for conveyer belts, speciality papers, biodegradable plastic and films, and medical dressings.

According to GM Insight, the lyocell market is estimated to be worth US$1.5 billion before 2024. This represents a compound annual growth rate of 8% and highlights the growing market opportunity for Nanollose and Grasim.

Both companies will seek to produce commercial quantities of the tree-free fibre, in hope that commercial agreements will be formed with fashion labels.

Management commentary

Nanollose executive chair, Dr Wayne Best, welcomed the progress with Birla Cellulose – Grasim’s business unit, saying:

We are extremely pleased with the progress of our collaboration with Grasim and Birla Cellulose, which has already delivered this joint patent application.

The nullarbor fibre produced by the team at Birla Cellulose has exceeded our expectations, and we now have a fibre that is not only more eco-friendly but has superior properties over conventional tree-based fibres.

We are very much looking forward to commencing the pilot production and presenting textiles made from this remarkable fibre to the fashion industry.

Chief technology officer for the Aditya Birla Group (owner of Grasim and Birla Cellulose), Dr Aspi Patel, added:

This innovative development is another important step in our continuing journey to make our fibres more sustainable.

This is an exciting development in the area of next generation alternative feedstock and we are looking forward to scaling up this technology in collaboration with Nanollose.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of January 12th 2022

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Top 10 - asx shares today
Share Market News

Here are the top 10 ASX shares today

Today, the S&P/ASX 200 Index (ASX: XJO) fought back against the selling pressure throughout the day to finish in the green. …

Read more »

The word inflation written with a ticking time bomb.
Share Market News

Why is it when Jerome Powell sneezes, the ASX 200 catches a cold?

Key points The ASX 200 took a hit following comments from the United States Federal Reserve chair Jerome Powell Expectations …

Read more »

blue arrows representing a rising share price ASX 200
Share Market News

These 3 ASX 200 shares are topping the volume charts this Friday

Finally, a day of green for ASX shares! The S&P/ASX 200 Index (ASX: XJO) is bouncing back strongly today, after a …

Read more »

Young boy wearing suit and glasses adds up on calculator with coins on table
Share Market News

This world-famous fund manager is ‘buying the dip’. Here’s why

Key points Bill Ackman is one of the most famous fund managers in the world He runs Pershing Square Capital …

Read more »

Two male ASX 200 analysts stand in an office looking at various computer screens showing share prices
Share Market News

ASX 200 (ASX:XJO) midday update: ResMed and PointsBet disappoint

At lunch on Friday, the S&P/ASX 200 Index (ASX: XJO) is on course to end the week on a much-needed positive …

Read more »

A man activates an arrow shooting up into a cloud sign on his phone, indicating share price movement in ASX tech shares
Share Market News

Is the Betashares Nasdaq 100 ETF (ASX:NDQ) an opportunity in this market correction?

Could the Betashares Nasdaq 100 ETF (ASX: NDQ) be a good opportunity during this correction for both the global share …

Read more »

A woman shouts through a megaphone.
Share Market News

2 ASX growth shares to buy in February with 40% upside

If you’re looking to make some additions to your portfolio in February, then the two ASX shares listed below could …

Read more »

Business woman watching stocks and trends while thinking
Share Market News

5 things to watch on the ASX 200 on Friday

On Thursday, the S&P/ASX 200 Index (ASX: XJO) fought hard and was able to record a small gain. The benchmark index rose …

Read more »