ASX materials shares have been a share market leading sector in 2025.
The S&P/ASX 200 Materials (ASX:XMJ) index has risen an impressive 20% since the start of the year.
The team at Bell Potter have identified two that still offer plenty more upside.
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Nickel Industries Limited (ASX: NIC)
Nickel Industries is a producer of nickel pig iron, a key ingredient in stainless steel. It is also engaged in exploring, mining, acquiring, and developing nickel projects globally.
Unlike other ASX materials shares, it has actually lost ground in 2025.
The stock price is down more than 10% since January and 18% in the last 12 months.
However, Bell Potter has a buy recommendation and price target of $1.20 on this ASX materials stock.
Based on yesterday's close price of $0.75, that indicates an upside of 60%.
In a report from the broker released on Tuesday, it reinforced patience is key on this global Nickel producer.
It said the company continues to make money through low nickel prices, benefitting from its upstream and downstream operations, diversified risk and margin exposure across an integrated value chain.
NIC currently has good balance sheet flexibility and 2Mt of stockpiled ore awaiting sale, but the re-emergence of permitting risk in Indonesia will reinforce some views in the market that higher risk premia should be applied.
Alkane Resources (ASX: ALK)
Alkane Resources is a gold exploration and production company. It owns and operates an open pit and underground gold mining development, near Dubbo in central west New South Wales.
Like many ASX gold shares, it has seen its share price soar in 2025.
This ASX materials stock is up an impressive 85% year to date.
In a report issued yesterday, Bell Potter reiterated its buy recommendation with an updated price target of $1.40 (previously $1.45).
From yesterday's close price of $0.98, this indicates an upside of 42.86%.
The broker said the stock offers multi-mine gold and antimony exposure, a strong balance sheet and platform focussed on organic and inorganic growth options
Production is set to more than double yoy on a gold equivalent basis; EPS are forecast to more than double yoy and we forecast significant free cash flow growth.
