As electric vehicle (EV) sales continue to grow across the globe, the demand for lithium proceeds to expand. Correspondingly, ASX-listed lithium shares have benefitted from the thematic, riding the wave to new heights.
We have taken the liberty of collating the best-performing lithium shares of FY21. This could shine some light on which companies are taking full advantage of the emerging green trend.
The pool of candidates is contained to constituents of the top 500 largest companies on the ASX – also known as the All Ordinaries Index (ASX: XAO).
On that note, let's pull the curtain on these highflyers.
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Best performing Lithium shares of FY21
AVZ Minerals Ltd (ASX: AVZ)
AVZ Minerals is the first company making the list this year. It is also the smallest among the best performers, with a market capitalisation of $549 million. The company is a lithium-focused mineral explorer holding a 60% interest in the Manono Project, located in the Democratic Republic of Congo.
In addition to rising lithium prices, the company's shares benefitted from two notable catalysts during the financial period. The first being an operational update for the Manono Project in October last year. In the update, AVZ revealed that some of the previously classified waste rock may be reported as mineable ore. The second catalyst involved the announcement of the company's first lithium offtake agreement.
Shares in the ASX company have since jostled around between 14 cents and 23 cents. However, that shouldn't dampen the 196% return for AVZ Minerals shareholders during the last financial year.
Galaxy Resources Limited (ASX: GXY)
The next entrant to the top performers is Galaxy Resources. This lithium producer has operations in Western Australia, Chile, and Quebec Canada. Unlike AVZ, Galaxy is already producing lithium concentrate – selling 150,630 dry metric tonnes in its 2020 full year.
Currently, Galaxy is working towards a merger with fellow lithium producer, Orocobre Limited (ASX: ORE). Both companies have agreed on the proposed $4 billion merger of equals. From there, the Supreme Court of Western Australia has made orders for Galaxy to convene a meeting for shareholders to vote on the proposal.
The Galaxy Resources share price soared 359% in FY21, putting this ASX lithium share at number 4 on the list. Yet, Macquarie thinks the returns could get even sweeter from here, with a 12-month price target of $4.70 on Galaxy.
Pilbara Minerals Ltd (ASX: PLS)
Pilbara Minerals is Orocobre's bigger competitor with approximately 30% more annual revenue in the 2020 calendar year.
As of December 2020, the company's trailing 12-month revenue was $105.5 million, an increase of 59.4% from December 2019. Additionally, the company's strategy and outlook announcement on 11 May showed plans to further increase production. In January, Pilbara Minerals reported record shipments of spodumene concentrate during the December quarter, setting the pace for 2021.
Notching up an incredible year, the Pilbara Minerals share price climbed 437% in FY21.
Piedmont Lithium Inc (ASX: PLL)
Next up is an ASX-listed lithium share that is based in the United States. Piedmont is on a mission to build a United States source of lithium hydroxide to power the electric vehicle transition. Currently, the company holds ownership of its North Carolina lithium project and Sayona in Quebec.
Initially, the ignition of the Piedmont share price excitement followed the company signing a sales agreement with Tesla Inc (NASDAQ: TSLA) in September 2020. Then the company took a strategic investment in Sayona Mining Ltd (ASX: SYA). However, more recently Piedmont completed a scoping study which confirmed that its Carolina Lithium will be among the world's biggest and lowest-cost producers of lithium hydroxide.
All of these announcements culminated together to deliver our first 10 bagger on the list. That's right, the Piedmont share price returned 1,120% during the last financial return. Count yourself lucky if you managed to hold on for those astonishing gains.
Vulcan Energy Resources Ltd (ASX: VUL)
Finally, taking out the top spot is Vulcan Energy Resource. This ASX lithium share has gone from a tiny mineral explorer trading around 50 cents a year ago to a beastly $8.41 per share. Vulcan aims to become the world's first lithium producer with net-zero greenhouse gas emissions.
The company's shares were already riding the lithium boom throughout the tail-end of 2020. However, the share price went vertical in early January. At that point of time plenty of excitement circulated around a Pre-Feasibility Study (PFS) for its Zero Carbon Lithium Project in the Upper Rhine Valley of Germany.
Just how big have the gains been for shareholders? Wait for it… 1,275%.
