Market's view on Zinnwald Lithium
Published on April 2024
- A 50 million Euro award for a European strategic project could significantly boost the company, especially compared to its 30 million sterling market cap.
- There is optimism that the company may follow in the footsteps of EMH, which is on the rise, indicating a positive outlook for lithium mining in Europe.
- Discussions suggest that securing offtake from German companies for EMH would be beneficial.
- There are expectations for an offtake and funding announcement soon for the company, following movements in adjacent projects like Cinovec.
- The annual report did not reveal much new information but conveyed a confident tone about receiving EU strategic status and grants, although funding and offtake might not occur this year.
- Speculation about a visit from Elon Musk to GigaBerlin raised hopes he might secure a local German lithium supply, though it was noted management might not notice such a visit.
- There is no immediate need for cash as the last equity finance was at a significant premium to the market.
- There was an equity finance in 2023, hinting at possibly another raise, although it was noted the company has plenty of cash.
- A Tamesis note highlighted the company’s low valuation, urging seizing the opportunity despite current lithium price levels.
- It is nearly assured that the company will get EU strategic project status along with some grant and project funding; however, an offtaker with serious investment is still needed.
- Share price is not expected to go anywhere until 2025.
- A delay in the bankable feasibility study (BFS) has been noted, moving from ‘early 2024’ to ‘late 2024’.
- An interesting video posted on the company’s website discussed extensive drilling activities and highlighted the need for an offtaker agreement and EU support to boost confidence.
- There is anticipation that the company could hit production in two years, potentially benefiting from the electric vehicle and other tech trends, despite current slow uptake and production pauses in the lithium industry.