ASX materials shares have seen modest growth so far this year.
The S&P/ASX 200 Materials (ASX:XMJ) sector has lifted roughly 3% in 2025 and has been largely outperformed by other sectors.
However, broker Bell Potter has identified two mid-cap materials companies with big upside.
Lets see what the broker had to say.
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WA1 Resources Ltd (ASX: WA1)
WA1 Resources Ltd is a mineral development in Western Australia and the Northern Territory. Its projects include West Arunta, Madura, Hidden Valley, and Niobium.
It has had a strong year thus far, already rising 28.74% since January.
Bell Potter believes there's more room for growth for this ASX materials share.
The broker has placed a "buy" recommendation and $26.00 price target on WA1 Resources Ltd (ASX: WA1) shares.
This indicates an upside of 51.96%.
The broker believes the Luni deposit (niobium resource) has the potential to become a major global source of niobium and could eventually generate about A$485 million in annual earnings before interest, tax, depreciation, and amortisation (EBITDA).
Niobium is a critical mineral utilised in the strengthening of steel. Global supply for niobium is concentrated (~90% produced from Brazil between two companies).
Bell Potter expects Luni to be a high-grade, large-scale niobium discovery in a stable jurisdiction (Western Australia), offering an alternate supply source to current routes.
Our recommendation for WA1 is based on a discounted cash flow valuation from our NDS for the Luni prospect, risked by 30% to take into account the stage of the project.
West African Resources Ltd (ASX: WAF)
West African Resources Ltd is engaged in mineral exploration in Burkina Faso. It focuses on the development of the Sanbrado Gold Project.
The Group's mineral portfolio also includes gold and copper-gold exploration permits in Burkina Faso.
This stock has risen 68.03% already in 2025.
Bell Potter still sees further room for growth.
The broker has a "buy" recommendation and $4.08 price target, which indicates an impressive 65.18% upside.
The optimism centres around the company's Kiaka Gold Project that is progressing towards first gold production (expected in Q3 2025), with the company aiming to produce over 420,000 ounces of gold annually.
