Galaxy Resources Limited

GXY Details

Moving on volatility:Galaxy Resources Limited (ASX: GXY) had recently reported that their results from the recent set of assays have been very good and the same confirmed the potential of James Bay, as a long-life high grade spodumene project. Particularly, assays have been received for a further 49 diamond holes for 10,111m of drilling, and the drilling has been both resource infill and resource extensional in type. Further, the group expects the outcome of the resource upgrade to be out soon and the Project Notice that outlines the scope is expected to be submitted to the relevant departments in the Quebec Government and the Federal Government of Canada, in some time. Given this positive update, the shares of GXY rallied over 46.1% in the last four weeks (as of September 26, 2017). However, post an initial rise, the stock slipped by about 3.9% on September 27, 2017. This slip has been witnessed since last week and is understood to be partly owing to profit-booking. Further, Australian lithium plays, overall, witnessed a weakness in comparison to global peers. However, the stock still has the run-up potential at the back of developments at its assets including James Bay and Mt Cattlin. We give a “Hold” recommendation on the stock at the current price of $ 2.45
 

James Bay Spodumene Project – Plan View (Source: Company reports)

Orocobre Limited

ORE Details

Positive drilling results at Cauchari Salar project: Orocobre Limited (ASX: ORE) recently reported that Advantage Lithium is acquiring an interest in the Cauchari project from the group. ORE owns 27,771 ha of mining properties over the Cauchari salar via its 85% owned subsidiary South American Salars. This project hosts brine containing elevated concentrations of lithium and potassium. Moreover, the initial test results from their flagship lithium property, located in the Cauchari Salar of Jujuy province in NW Argentina showed good brine concentrations and chemistry similar to that at Olaroz (JV partner Advantage Lithium with 35% interest). Initial results from the first set of composite brine samples from hole CAU10 in the SE sector of Cauchari showed an average lithium grade of 678 milligrams per liter (mg/l) with sample results ranging from 585 to 724 mg/l lithium and excellent Mg/Li ratios averaging 2.1:1. ORE stock delivered 27.1% in the last four weeks but slipped 6.7% in last five days (as of September 26, 2017), while we give a “Hold” on the stock at the current price of $ 4.13, given the propelling lithium demand.

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