If you have a high tolerance for risk, then it could be worth looking closely at Alpha HPA Ltd (ASX: A4N).
That's because the team at Bell Potter believes this ASX 300 share could rise materially from current levels.
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What is Alpha HPA?
Alpha HPA is the owner of the HPA First Project in Gladstone, Queensland, which is aiming to supply high-purity aluminium-based products to the semiconductor, lithium-ion battery, and light emitting diode (LED) manufacturing sectors.
Bell Potter notes that the project's proprietary technology is expected to disrupt incumbent HPA production through delivering ultra-high purity products with significantly lower unit costs.
The broker highlights that a recent update revealed letters of intent and commercial supply agreements. It said:
A4N's positive marketing update points to product offtake Letters of Intent exceeding 12ktpa, further maturity in commercial supply agreements from Stage 1 production, adoption of HPA in semiconductor tooling, and product demand projections exceeding 50ktpa by 2030. Four new LOIs include: 324tpa for semiconductor thermal fillers (2 x LOIs to South Korea & Japan); 180tpa for catalyst applications; and up to 5,000tpa from a Tier-1 lithium-ion battery group which follows a multi-year cycle of product qualification.
Commercial supply agreements have been added with US and European semiconductor Chemical Mechanical Planarisation customers and with Japanese and South Korean semiconductor thermal filler customers. A4N's modelling sees demand for key products HPA and High Purity ATH exceeding 50ktpa by 2030, including around 30ktpa from the semiconductor sector.
Bell Potter thinks this leaves the ASX 300 share well-placed to unlock its debt funding. It adds:
The update puts A4N in a strong position to meet Conditions Precedent to draw on its $400m debt funding from Export Finance Australia and the Northern Australia Infrastructure Facility. A key CP was 100% offtake coverage from Stage 2 (10ktpa). We expect that A4N will now be working with the lenders on the basis that a significant offtake threshold has been reached, to enable debt release in 2H 2026.
In the interim, A4N is well funded, with $212m cash at the end of the last quarter. A4N's sales from its current smaller-scale Stage 1 facility are important market seeding to demonstrate the unmatched capability of A4N's HPA First products. The demand modelling, in particular from the AI data centre-driven semiconductor sector, adds further confidence with respect to the debt CPs and future expansion potential.
Big potential returns for this ASX 300 share
According to the note, Bell Potter has retained its speculative buy rating and $1.50 price target on Alpha HPA's shares.
Based on its current share price of 86 cents, this implies potential upside of approximately 75% for investors over the next 12 months.
Commenting on its speculative buy recommendation, Bell Potter concludes:
Over 2H 2026, we expect A4N to firm-up existing offtake LOI volumes and progress to sales contracts for Stage 2 capacity. A key catalyst will be drawing on the project's committed NAIF and EFA debt facility, which we expect in 2H 2026. A4N's recent commentary relating to potential volume expansions beyond Stage 2 give us further comfort on the long-term adoption of HPA by the semiconductor sector and therefore product demand. We have made no changes to our A4N valuation or positive outlook in this report.
