ASX penny stock Nickel Industries Ltd (ASX: NIC) has started the year off with a bang.
The company 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.
It closed 2025 trading at $0.83 each, and closed yesterday at $0.95.
That's almost 15% higher in just a few days of trading.
Why the red hot start?
Investors have been reacting positively to the announcement of a strategic partnership with Sphere Corp, including a US$2.4 billion valuation for its ENC HPAL project and the first Western offtake agreement for ENC nickel cathode.
What does this mean?
South Korean-listed Sphere Corp will acquire a 10% stake in the ENC HPAL project at a US$2.4 billion valuation.
The funding completion is expected in early Q1 2026.
The partnership is the company's first offtake deal into Western markets, specifically targeting the fast-growing aerospace and aeronautical industries.
What's Bell Potter's view?
Following the announcement, broker Bell Potter released a new report on this ASX penny stock.
The broker said there have been positive catalysts emerging for the company in the last couple of weeks.
Bell Potter views these as a precursor to a transformational year for Nickel Industries.
These include receipt of an increased ore sales permit, the disclosure of a strategic partnership at the ENC HPAL plant and a rising nickel price.
The broker highlighted The LME nickel price has surged from an 8-month low to a 14-month high in the last two weeks in a burst of volatility that can be a feature of the nickel market.
NIC's share price has appreciated ~27% since early December, with this being a key driver.
Increased target price
In the report, Bell Potter included EPS changes of: CY25: -25%; CY26: +22%; CY27: +4%.
The broker also reinforced its buy recommendation, and upgraded its price target to $1.30.
From yesterday's closing price of $0.95, this indicates an upside of 36.84%.
NIC is one of the world's largest listed nickel producers and offers exposure across a range of nickel products and markets. It 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.
