JPMORGAN initiate KDR BUY $2.50 target, page-7

More from JPMorgan

Sell-off creates opportunity to buy into quality assets
 The Electric Vehicle thematic is emerging at an unprecedented rate. The shift
towards auto electrification continues to receive positive tailwinds as global
auto manufacturers release new hybrid and full electric models along with
global sales targets.
 Positive sentiment towards the lithium market and listed equities has driven
up asset valuations and forced attention from industry players, downstream
customers and global money managers.
 Spot lithium pricing remains close to record highs and despite recent supply
announcements and a subsequent re-basing of equity valuations, we believe
the lithium market will remain tight in 2018. Capital flows towards upstream
projects need to continue.
 We initiate coverage of Mineral Resources, Orocobre Ltd., Galaxy Resources
and Kidman Resources with Overweight ratings, and of Pilbara Minerals at
Neutral. Our sector pick is GXY, trading on 0.7x P/NPV & 7.5x EV/EBITDA.