Via its Karibib project in Namibia and unique IP, Lepidico is a vertically integrated lithium development business that has produced both lithium carbonate and lithium hydroxide from non-traditional hard rock lithium-bearing minerals using its registered L-Max and LOH-Max processes.
In the light of its updated DFS, we conservatively valued Lepidico at 5.39c/share, plus a further 0.68–1.66c/share for a significantly risk-adjusted, full-scale, 20,000tpa lithium carbonate equivalent Phase 2 plant. However, if Benchmark Mineral Intelligence’s lithium hydroxide price forecasts are used instead of our own, this valuation would almost double to 10.17c/share. Since then, the company has announced a 1 for 4 entitlement/rights offer to raise A$5.7m.
Metals & Mining |
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Metals & Mining |
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Metals & Mining |
Update
Metals & Mining |
Flash note
Joe Walsh
CEO
Shontel Norgate
CFO
Forecast net debt (A$m)
34.4
Forecast gearing ratio (%)
42
% | 1M | 3M | 12M |
---|---|---|---|
Actual | (21.1) | (47.4) | (64.9) |
Relative | (18.1) | (46.8) | (66.7) |
52 week high/low | A$0.0/A$0.0 |
Lepidico’s patented technologies produce lithium hydroxide (plus by-products) in an environmentally friendly way, sourced from less contested minerals such as lepidolite. On 30 October 2023, it released updated economics in relation to its 2020 DFS for an integrated mine and lithium hydroxide chemical plant, which indicated an NPV (8%) of US$457m or c A$697m (A$0.094 per share). Based on previous research, this would imply a pre-funding valuation for Lepidico of 2.9c/share.
Y/E Jun | Revenue (A$m) | EBITDA (A$m) | PBT (A$m) | EPS (fd) (c) | P/E (x) | P/CF (x) |
---|---|---|---|---|---|---|
2022A | 0.0 | (4.8) | (7.9) | 0.0 | N/A | N/A |
2023A | 6.4 | (1.2) | (3.0) | 0.0 | N/A | N/A |
2024E | 0.0 | (3.1) | (3.7) | 0.0 | N/A | N/A |
2025E | 0.0 | (3.1) | (6.9) | 0.0 | N/A | N/A |