It's been 11 months since this portfolio manager invested in Pilbara Minerals and Lynas. This is what’s next.

Eiger Capital's Stephen Wood reluctantly sold out of his position in PLS after it rose to large-cap status. Here, he names a new contender.

A DAY AGO

LW: Where have you redeployed your capital from Pilbara Minerals?

Stephen Wood: We've had to more or less sadly say goodbye to Pilbara because it's grown up and turned into an ASX 50 company. It's been a real success story. But as a small and mid-cap manager, we are tasked with finding newer, smaller, developing businesses, not businesses that are making hundreds of millions of dollars a quarter, which Pilbara now is. We have redeployed our lithium investment. Funnily enough, one of our commandments is all about the quality of management. We've redeployed our Pilbara investment into a company called Patriot Battery Materials (ASX: PMT). It has Ken Brinsden backing it. He was the CEO that built Pilbara from nothing to what it is now. It's a very early-stage lithium mine in Quebec in Canada. We also like investing in places like Australia and Canada, where in the mineral space you have just a lot less sovereignty risk than in a lot of other jurisdictions, particularly in this space in Latin America.

So we think it's a big resource. It's in a great place. In Quebec, there's a lot of cheap electricity with hydro to help with processing costs. And importantly for Patriot, Canada is a full participant, Australia's trying to be, in the Inflation Reduction Act, and all the subsidies and benefits that come with that. And not only that but if you go and draw yourself a little line on a map, it's not that far from the enormous US car industry. So whether it's location, sovereignty risk, management, or size of the resource, it's early stage, but that's our current best idea for where to try and find the next emerging lithium miner.