The Delta Lithium Ltd (ASX: DLI) share price could have huge upside potential.
That's the view of analysts at Bell Potter, which have just reiterated their buy rating on the ASX lithium share this morning.
What is the broker saying about this ASX lithium share?
Bell Potter highlights that Delta Lithium has just announced the appointment of Mineral Resources Ltd (ASX: MIN) founder and CEO, Chris Ellison, as its new non-executive chair with immediate effect.
In addition, Mineral Resources has increased its stake in the Western Australia-based lithium explorer to 17.44%.
Commenting on the news, the broker said:
It's unclear how the benefits of any potential integration would be divided between DLI and MIN, but we expect an integrated scenario to exceed our DLI risk-adjusted independent valuation, given MIN's capabilities and existing operations significantly de-risk DLI's development pipeline, and accelerate earnings potential.
Potential takeover target?
Bell Potter also suspects that if the Delta Lithium share price were to weaken, Mineral Resources could push for a full takeover. It said:
In our view, given MIN's clear interest in DLI's projects, any weakness in DLI's share price could result in a full takeover offer. We expect a number of potential catalysts for DLI in late CY23 / early CY24, including i) Mt Ida development plans, ii) Yinnetharra initial Mineral Resource estimates, and, iii) Jamesons Prospect exploration commencement.
Big potential returns
Bell Potter currently has a speculative buy rating and a $1.35 price target on the lithium explorer.
Based on the current Delta lithium share price of 74 cents, this implies a potential upside of 82% for investors over the next 12 months.
