Lithium Power International (LPI): Initiation - Riding the lithium wave

London, UK, 22 March 2022

Lithium Power International (LPI): Initiation - Riding the lithium wave

Lithium Power International (LPI) owns 51.6% of the advanced lithium brine project in the Maricunga Salar in Chile. Based on the 2022 updated feasibility study, the project has relatively attractive economics supported by the strong lithium market fundamentals and low opex. Lithium demand is expected to grow exponentially, driven by e-mobility, with prices likely to remain at elevated levels that will encourage new supply. We value LPI at A$1.02/share based on the 15.2ktpa carbonate operation and additional lithium resources that are currently outside of the project's scope.

Our valuation of LPI is based on the 15.2ktpa project, and key operating and cost assumptions from the 2022 DFS. We use a discounted cash flow to equity approach that assumes equity dilution. At a 10% discount rate, our NPV yields a valuation of A$0.85/share for LPI. To this we add a value for the remaining lithium resources, which we estimate at A$0.18/share. A 10% increase in our long-term carbonate price moves our base case NPV up by c 20%. We see the key risks as an uncertain political situation and general opposition to lithium projects in Chile.

Click here to view the full report or here to sign up to receive research as it is published.

All reports published by Edison are available to download free of charge from its website

www.edisongroup.com

About Edison: Edison is a leading research and investor relations consultancy, connecting listed companies to the widest pool of global investors. By focusing on the volume and quality of investors reached - across institutions, family offices, wealth managers and retail investors - Edison can create and gauge intent to purchase, even in the darkest pools of capital, and then make introductions via non-deal roadshows, events or virtual meetings.

Having been the first in-market 17 years ago, Edison now has more than 100 analysts covering every economic sector. Headquartered in London, Edison also has offices in New York, Frankfurt, Amsterdam and Tel Aviv and a presence in Athens, Johannesburg and Sydney.

Edison is authorised and regulated by the Financial Conduct Authority.

Edison is not an adviser or broker-dealer and does not provide investment advice. Edison's reports are not solicitations to buy or sell any securities.

For more information, please contact Edison:

Andrey Litvin +44 (0)20 3077 5700 [email protected]

Learn more at www.edisongroup.com and connect with Edison on: 

LinkedIn        www.linkedin.com/company/edison-group-/

Twitter           www.twitter.com/Edison_Inv_Res

YouTube       www.youtube.com/edisonitv