Lithium - Tesla - alb - min : Howard Klein, page-30

OC Funds December 31 update;  

- MIN a long term ‘Top 5” holding in both its’ Dynamic Equity Fund and its’ Premium Small Company Fund (NB it only manages three funds!)
cheers

https://www.ocfunds.com.au/wp-content/uploads/2021/01/201231-OC-Dynamic-Equity-Fund-Fund-Update.pdf

Mineral Resources (MIN, +50.3%) continued to rally throughout the quarter and finished the calendar year
at a record high.

MIN remains one of the Fund’s largest holdings and has multiple macro-economic tailwinds at present, as well as some material growth catalysts which could increase the earnings of the business by a significant quantum over the coming two to three years.
On the macro front, the iron ore price has continued to rally over the quarter, with Dalian iron ore futures currently near US$170.00 per tonne making MIN’s Koolyanobbing and Iron Valley operations highly profitable.

Lithium stocks too have come back into vogue in financial markets after a steep sell-off and are once again running hot with lithium prices in China increasing from 2020 lows and global electric vehicle sales reaching record highs in recent months.

As a reminder, MIN has a stake in two world class lithium projects namely a 40% share of the Wodgina Spodumene project and 50% of the Mt Marion Spodumene project with two experienced JV partners (Albemarle and Ganfeng respectively) specialising in downstream chemical processing, as well as a 40% shareholding in the Kemerton Lithium Hydroxide plant with Albemarle.

Under its growth strategy, outlined at the November AGM, MIN will develop two iron ore hubs in the West Pilbara and at South West Creek in Port Hedland (along with associated infrastructure) and will also develop two new iron ore berth facilities at Ashburton (25Mtpa) and South West Creek (40Mtpa).

These new projects have the potential to more than treble MIN’s current iron ore operations to approximately 90Mtpa in the next 3-5 years and would place MIN as the fourth largest iron ore producer in Australia next to Fortescue Metals Group.
Whilst there is some way to go for these projects in terms of approvals, financing and construction, they will leverage MIN’s existing “pit to port” capabilities and will also increase the growth rate of MIN’s underlying mining services business.

We believe the MIN management team, led by first-rate mining entrepreneur Chris Ellison, has a strong track record of creating shareholder value from greenfield projects and continue to believe the outlook for the company warrants its position as a top five holding in the Fund.