Why has this ASX share you've never heard of soared 30% already this month?

What does Bannerman Energy do, and why has its share price skyrocketed in March?

Bannerman Energy Ltd (ASX: BMN) is not a name you hear very much, but you might be interested to know that this ASX share has skyrocketed 31% so far this month.

So why would this company, now with a market capitalisation of $338 million, be popping up on the radar of some ASX investors?

The only relevant official announcement this month is that it will join the All Ordinaries Index (ASX: XAO). This means it is now one of the top 500 companies on the ASX.

That can have a minor impact on ASX share prices, as any inclusion in an index forces passive funds to buy those shares.

But that alone is unlikely to be worth a 31% hike in the stock price since the closing bell on 28 February.

A man and a woman sit in front of a laptop looking fascinated and captivated.

Image source: Getty Images

What does Bannerman make, exactly?

The more likely reason lies in the commodity that Bannerman produces.

The company's main business is in Namibia, where it is developing a mine that is forecast to start producing uranium in 2025.

"Our flagship Etango Project is one of the world's largest undeveloped uranium assets," reads the company website.

"It is located in the highly established uranium mining jurisdiction of Namibia and we have environmental permits in place for development."

We have all heard many times since the war in Ukraine broke out that energy prices and ASX energy shares would head upwards.

Russia is an oil and gas exporter but it faces trade sanctions that will prevent its supply from going out to its usual clients.

Continental Europe is especially reliant on Russian energy. But after the recent invasion of Ukraine, Europe will seek to diversify its sources.

One alternative could be nuclear energy, which France already utilises extensively, and which Germany formerly used. 

Uranium could be a valuable fuel in coming years

All this means uranium will get caught up as a fuel commodity in any global energy price surge.

And perhaps this month investors have started noticing Bannerman's potential as a future producer.

Bannerman Energy shares finished the session on Thursday at 27.5 cents, up 5.77% for the day.

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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