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.
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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.
