Why the Redflow (ASX:RFX) share price rocketed 39% higher today

The Redflow Ltd (ASX:RFX) share price rocketed to a new 52-week high on Tuesday. Here's why investors are buying its shares…

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The Redflow Ltd (ASX: RFX) share price was among the best performers on the Australian share market today.

The energy storage company's shares jumped as much as 39% to a 52-week high of 10 cents at one stage.

The Redflow share price ultimately ended the day 35% higher at 9.7 cents.

Why did the Redflow share price rocket higher?

Investors were fighting so hard to get hold of the company's shares this morning that it received a speeding ticket from the ASX Ltd (ASX: ASX).

And just like Zip Co Ltd (ASX: Z1P) said when it received its own speeding ticket today, Redflow advised that it was "not aware of any information concerning it that has not been announced to the market which, if known by some in the market, could explain the recent trading in its securities."

As with Zip, the company pointed to a recent announcement as a possible reason for the strong rise in the Redflow share price.

What was the announcement?

Redflow told the Australian Stock Exchange operator that its announcement on 11 February 2021 was positively received at the time.

That announcement revealed that it has partnered with telco giant Optus to deploy Redflow batteries as part of the Australian Government's Mobile Network Hardening Program.

The Australian Government announced the $13.2 million program last December to enable Telstra Corporation Ltd (ASX: TLS), Optus, and TPG Telecom Ltd (ASX: TPG) to extend the battery backup at 467 mobile phone towers for a minimum of 12 hours. This is in recognition that most power outages occur during emergencies.

Last week, Optus installed its first Redflow battery system under the Government's program at a black spot site in Lexton, Victoria. The telco is now planning to deploy Redflow batteries in at least 56 black spot sites as part of the program. Optus has also used Redflow batteries in the environmentally sensitive Daintree Forest in Queensland since 2019.

Redflow's Managing Director and CEO, Tim Harris, believes Redflow's battery design was ideally suited for the Mobile Network Resiliency Program.

He commented: "Redflow's solution is suited to warm climates, has lower fire risk than other battery chemistries, is easily integrated with existing batteries, has an energy-saving standby power mode and carries strong environmental credentials. Redflow batteries will play an important role in improving the resiliency of networks, particularly in bushfire-prone areas."

Following today's gain, the Redflow share price is up a whopping 273% since the start of the year.

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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