Eye on Lithium: Tianqi’s massive US$1.7b Hong Kong IPO ‘could be leading indicator for turnaround’ in lithium stocks
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All your ASX lithium news for Thursday, July 7.
Tianqi Lithium has raised around HK$13.5 billion (US$1.7 billion) in its Hong Kong IPO, reportedly selling 164.1 million shares at HK$82 apiece.
The share sale breaks a months-long drought for large offerings in Hong Kong, where funds raised between January and June fell more 90% from the previous year.
Notably, in its Shenzhen IPO back in 2010, the company raised 735 million yuan (US$110 million).
Narratives shift every 6-12 months.
$1.7B Hong Kong IPO priced at *top* of HK$69-82 range.https://t.co/QULyNz7BP3
— Howard Klein (@LithiumIonBull) July 6, 2022
The lithium producer has operations in China and Chile, but also has a joint venture with IGO (ASX:IGO) in the Kwinana lithium refinery in WA, which is the first lithium refinery outside China – and delivered the first batch of battery-grade lithium hydroxide in May.
Producing lithium hydroxide in commercial quantities is kind of a big deal.
It’s a key component in electric vehicle high nickel battery cathode chemistry, delivering higher energy density and longer driving distances between charges.
The first train at the Kwinana Plant is ramping-up towards its nameplate capacity of 24,000 tonnes of battery grade lithium hydroxide per annum.
The aim is to recommence construction of Train 2 during 1H23 – with an $18m early works budget already committed.
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A total of 43 stocks were in the green today, 49 were flat and 38 were in the red.
The company has wrapped up its inaugural 5,000m drilling program at the Mavis Lake project in Canada, with another five step-out holes intersecting spodumene-bearing pegmatite.
A total of 35 out of 37 drill holes have now intersected spodumene-bearing pegmatite mineralisation, which MD Alex Biggs said was a fantastic result and “proves the significance of the Mavis Lake Pegmatite field.”
“Importantly the company has now received the necessary approvals to extend drilling by an additional 5,000m,” he said.
The company remains focussed on defining a JORC resource at Mavis Lake.
PLL has been added to the US Russell 2000 Index – a small-cap stock market index that makes up the smallest 2,000 stocks in the Russell 3000 Index.
The company was also added to the Russell Microcap Index as part of the 2022 Russell indexes reconstitution – which captures the 4,000 largest US stocks as of May 6, ranking them by total market capitalisation.
“One of the objectives of our redomiciling in 2021 was to qualify for important stock indices that require U.S. domiciliation,” CEO Keith Phillips said.
“Piedmont shares are now held by many index funds, including those managed by State Street, Vanguard, Blackrock, and others, and we hope that these long-term holders will support our shareholder value creation objectives in the longer-run.”
Membership in the Russell 2000 Index, which remains in place for one year, is based on membership in the broad-market Russell 3000 Index.