Motley Fool Australia

EcoGraf (ASX:EGR) shares up 72% in a week

Growth of ASX 200 tech shares represented by man's hand grabbing onto red ladder that is pointed towards sky
Image source: Getty Images

We have seen a surge in companies positioning themselves for the rise of the lithium battery industry. For example, lithium mining company Galaxy Resources Limited (ASX: GXY) has seen a 56.5% rise in share price in year to date trading. Other metals required for cathodes include manganese, mined by South32 Ltd (ASX: S32), also nickel and cobalt, currently being developed by Ardea Resources Ltd (ASX: ARL). Nevertheless, one of the few listed Australian miners focused on graphite, the anode material is Ecograf Ltd (ASX: EGR)

What is moving EcoGraf ASX shares?

In the past week, EcoGraf ASX shares rose by 72.414%. The company has two bases of operation. First, in Tanzania it is developing The Epanko Graphite Project. This is a long life, highly profitable graphite project. It is forecast to produce 60,000 tonnes / yr of natural flake graphite products.

Second, the company is developing a processing plant in Kwinana, Western Australia. This will to produce spherical graphite using a new eco-friendly process to sell directly to lithium-ion battery manufacturers. The plant will draw both from recycled battery materials as well as graphite flak products from the Americas, Asia and Australia. 

Over the past 6 months it has had a succession of very promising and positive releases. For example, it recently reported solid results from its proprietary purification process to recover high purity battery anode material from lithium-ion battery materials. Furthermore, it has also provided electrochemical analysis supporting the claim that battery products uniquely positioned as a superior and cost competitive material for battery anodes.

EcoGraf has already had a lot of positive support from the West Australian government. The company believes that it can deliver a plant in Kwinana within 11 months of a final investment decision.   

Foolish Takeaway

EcoGraf ASX shares currently value the company at $54.6 million. It appears to have a pathway top funding in Tanzania as well as  in Kwinana. The management team includes several resources professionals with a solid track record of bringing in large scale developments. 

With no funding secured, the company remains a speculative play. However, EcoGraf has an experienced leadership team, and is starting its development stage. I think this could be a great growth story in the battery business over the next few years. 

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

*Returns as of June 30th

Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Related Articles…

Daryl Mather
Latest posts by Daryl Mather (see all)