Whilst gold shares such as Newcrest Mining Limited (ASX: NCM) and St Barbara Ltd (ASX: SBM) may be grabbing the headlines in the resources sector today after their shares dropped sharply, they're not the only shares in the sector that have taken a hit.
Australian graphite producer Syrah Resources Ltd (ASX: SYR) has dropped a whopping 16% today after the company announced the surprise resignation of its managing director Mr Tolga Kumova.
According to the release the company has described Mr Kumova's resignation and the search for a new managing director as part of a "transition reflecting the evolving strategic direction of the company and the key development activities it is currently undertaking."
Syrah's chairman Jim Askew will step into an executive chairman role until a new managing director has been appointed.
As we have seen with Vocus Communications Limited (ASX: VOC) recently, the market does not take kindly to sudden departures from the C-suite. Like Syrah, Vocus' shares have been smashed since its CFO Rick Correll announced his resignation.
Sudden departures like that of Mr Kumova and Mr Correll have a tendency of leaving the market speculating that something is amiss behind the scenes. For this reason, I wouldn't be expecting to see its share price bounce back anytime soon.
Which is unfortunate for the equities team at Macquarie Group, which according to a research note released this morning, placed an outperform rating and a $6.60 price target on its shares before the news broke.
If everything turns out to be fine with the company then it would certainly be an attractive option for investors looking for exposure to the lithium boom. Its Balama graphite project in Mozambique is now at an advanced construction phase and is on schedule to open in the second quarter of 2017.
When it does open it will be the largest producer of high purity graphite in the world. According to management, Syrah has completed extensive product certification test work with several major battery producers for the use of Balama spherical graphite in the anode of lithium-ion batteries.
Although it's not one that I would personally choose to invest in right now, it may admittedly be worthy of further investigation.
