Australia's wealthiest person, Gina Rinehart, has just made her latest bet in the mining sector.
Rinehart's riches came from mining, and her main entity, Hancock Prospecting, has been investing in a company attracting plenty of attention this week: S&P/ASX 200 Index (ASX: XJO) mining stock Lynas Rare Earths Ltd (ASX: LYC).
Lynas mines various rare earths, including neodymium and praseodymium (NdPr). It's the world's only major producer of separated rare earths outside of China. Rare earths are used in many high-tech and future-facing applications, including electronics, wind turbines, and hybrid and electric vehicles.
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Rinehart increases stake
Before this week, Hancock Prospecting owned 54.4 million Lynas shares, representing 5.8% of the ASX 200 mining stock.
Lynas reported in an ASX announcement today that Hancock Prospecting had increased its stake by 12.34 million Lynas shares since the last notice in April 2024. This investment takes its stake to 7.14% of the rare earth business.
The miner advised that Hancock Prospecting had made numerous investments over the last three months, with this week's two transactions being the biggest. Yesterday, it bought 1.18 million Lynas shares for $5.97 per share, and on Tuesday, it bought 1.32 million Lynas shares for $5.99 per share.
It appears Rinehart and her business associates are excited about the rare earth miner and want to keep boosting their stake because of its strategic importance.
Recent update
Lynas recently gave the market its operational update for the three months to 30 June 2024, which wasn't the most inspiring set of figures.
The miner reported gross sales revenue dropped 13.3% to $136.6 million, while sales receipts dropped 37.8% to $117.5 million.
Lynas reported it produced 2,188 rare earth oxide (ROE) tonnes, down year over year from 4,475 tonnes in the fourth quarter of FY23. NdPr production was 1,504 ROE tonnes, down from 1,864 tonnes in the prior corresponding period.
The ASX 200 mining stock explained the lower production was due to essential maintenance conducted at Lynas Malaysia during the quarter.
Lynas reported there was a "slight improvement" in China's domestic end-product demand, though market prices "remained low". However, the average selling price "improved through the quarter" as it "carefully managed the timing of sales, especially for heavy rare earth which were quite volatile throughout the quarter."
Lynas share price snapshot
As the chart below shows, the Lynas share price is down around 15% from the start of the year and has dropped 14.4% since 21 May 2024. Shares in the miner are trading 0.25% higher today at $6.08.
