Battery Minerals Limited

Encouraging Results at September 2018 Quarter: Battery Minerals Ltd (ASX: BAT) is a micro-cap company with the market capitalization of $26.73 Mn as of November 29, 2018. It is a diversified mining development and minerals exploration firm which committed to exploring and developing mineral deposits in Mozambique. As of now, the group focuses on the graphite and aligned minerals which used in the lithium-ion battery sector. Recently, the company disclosed its September 2018 quarter activities report wherein it emphasized its prominent advancement in the Montepuez development project. The project funding assignment has been bestowed upon “Origin Capital” hereby the project funding advisers. Fund raising amounting to $20 Mn has already been successfully completed by the early July 2018. The site is done with the tailing storage facility and earth works for the processing plant. Moreover, the battery anode testing has come up with encouraging results as the graphite excavated has come up with outstanding purity. Also, the company’s drilling at the new Warthog site is coming up with some phenomenal results which are underlined by the total graphitic carbon (TGC) percentage of 9.8% for 18m hole & 11.1% TGC from the 6m hole.

As regards the resource update, the Group’s total mineral resource is now slated at around 152.5mt @ 8.5% which materializes to 13.03mt of contained Graphite. Also, post the grade control drilling program the resources at Buffalo site has exhibited a 33% rise in the contained graphite.

The group’s loss for the 1H 2018 was $3,652,901, this is due to the fact that the company is incurring huge costs at its Montepuez Graphite project & Balama Central Graphite project. Also, the company had a cash balance of $12.2 Mn as at 30 September 2018.

However, as per the Notes to accounts presented by the company, it has stated that the groups' ability to continue as the going concern solely depends upon its ability to raise additional funding via various means of finance.

Global Graphite Demand (Source: Company Reports)

In the last six months, the share price of the company had fallen by 57.14 percent as on 28 November 2018 and traded at lower level. Since the company has seen encouraging results at both of its Projects and has a capability to raise capital for the projects whenever needed, thus, we maintain our “Hold” recommendation on the stock at the current market price of $0.024.
 
 

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