ASX small-cap shares can be some of the most exciting investments to own because of their ability to scale in size from where they are today.
Compounding is a very powerful force – businesses earlier on in their growth journey can expand significantly before size starts becoming a major roadblock to strong returns.
The fund manager Wilson Asset Management (WAM) runs a number of listed investment companies (LIC) including WAM Active Ltd (ASX: WAA) which targets mispriced opportunities in the ASX share market.
The investment team from WAM outlined two opportunities in the portfolio including a mining company and Australian medical technology company.
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Lindian Resources Ltd (ASX: LIN)
WAM describes Lindian Resources as an Australian-based bauxite and rare earths company that has operations across exploration, mining and processing with projects in Malawi, Guinea and Tanzania.
The fund manager noted the company is focused on advancing the Kangankunde rare earths project in Malawi alongside an Australian downstream route.
In October, the Lindian Resources share price rise of 22% reflected "improved project clarity and de-risking through confirmation that Kangankunde will not be affected by Malawi's raw-minerals export order."
Last month, the ASX mining share also announced its update for the three months to September 2025, which included a number of achievements, including a final investment decision on the Kangankunde project, enabled by the successful completion of a $91.5 million capital raising.
That placement will fully fund the ASX small-cap share's project until first production in the fourth quarter of 2026, as well as a long-term strategic partnership with Iluka Resources Ltd (ASX: ILU).
WAM concluded its thoughts on the business with the following:
We believe the company's recent activity supports investor confidence in the near-term and positions the company to play a pivotal role in the global rare earth supply chain.
Artrya Ltd (ASX: AYA)
The other ASX small-cap share that WAM wanted to highlight in the WAM Active portfolio is disruptive medical technology company Artrya, which is focused on the detection and management of coronary artery disease.
The fund manager noted that coronary artery disease is the leading cause of death in developed countries, but diagnostic methods have remained unchanged for almost five decades.
Artrya uses artificial intelligence (AI) to deliver accurate and non-invasive diagnoses in an emergency and primary care settings.
In October, the Artrya share price jumped by 45% following the completion of an oversubscribed capital raising program.
The funding raised meant it secured growth capital and positioned the ASX small-cap share to accelerate its product roll-out and regulatory initiatives.
WAM concluded on the business:
Longer term, we believe the strengthened balance sheet supports execution on a capital-light software-as-a-service model with expanding global opportunities.
