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AKE - Allkem Limited

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I'm not sure what the market was expecting, probably a lot since it's doubled last FY, but not sure what was forecast. So, maybe this profit is factored in.

Got a lot of money in the bank, which I assume is to pay for their growth and development projects like Sal de Vida and James Bay. If Lithium stays around $50Kt then it should have another very good year.

But, who was the bank that said lithium was going to tank? Goldman Sachs? Doesn't look like that's going to happen unless we go into a global depression and demand tanks. The supply/demand projection is still looking like deficit after 2030.



 
Looks like an $8.8b MC is tops for AKE. Mr Market just doesn't like it above that level for the minute.

 
This looks promising, but has a tendency to drop back, so should really be looking at EOD chart....

 

Allkem (ASX:AKE) eyes US$200m finance facility for Sal de Vida, Argentina

Allkem (ASX:AKE) has progressed activities to secure a US$200 million project financing facility for its Sal de Vida project in Argentina.
themarketherald.com.au
Allkem (AKE) has progressed activities to secure a US$200 million (A$311.5 million) project financing facility for its Sal de Vida project in Argentina.

The company agreed on a non-binding term sheet for the facility with the International Finance Corporation (IFC), which will help support development of the project during stage one.
 
Yikes, I'm really not sure where that came from, unless there was something in the AGM that caught people off guard. Lithium hasn't crashed without me knowing has it? The first production in Japan was announced, but that's supposed to be a good thing. Maybe just profit taking...

Fingers crossed that $14 support line holds up.

 
Hi Sean....... I reckon some Profit taking is the way to go.......maybe the punters have realised how overbought AKE is atm........considering that their IV is somewhere between $10.35 to $12.36....... The candles for 11/11/22 & 14/11/22 showed that Sellers were in control, that signalled the ST Profit Taking IMO.
Supposed 2B on holidays and away from trading atm, but the Dragon Lady is absent, so I can sneak in occasionally.....
 
Lithium down across the board. Not just AKE
 

Lithium down across the board. Not just AKE
Click to expand...
or ...

Rumours that a major Chinese cathode maker cut its output forecasts sent listed lithium producers plunging on Tuesday, in the first sign of soft demand for the battery metal since this year’s boom.

Lithium carbonate futures on the Wuxi Stainless Steel Exchange dropped 7 per cent on “speculation in China that a major cathode producer might have slashed production targets and some Chinese firms forecasting softening in the market later in 2023,” said Credit Suisse analyst Saul Kavonic.

(I wouldn't bother with Motley Fool as an authoritative source for much, btw)
 
Boggo said:
Just Goldman Sachs, Credit Suisse and State Street doing what they do.

AFR has an article referring to them.
Click to expand...

I wonder how deep their shorts are.

$14 tried hard to hold it up but then it just capitulated through. Should be some support across $12.

Lithium price still holding up. I imagine when there's a decent correction in that price these players will take a hit.

 
You have to wonder why people even listen to Goldman Sachs.

Goldman Sachs Statements on Lithium Prices Depart from Reality | Midas Letter

Goldman Sachs is at it again. After the publication of their report “The End of the Beginning” in June this year led to a sell-off across all publicly traded lithium issuers, they have apparently doubled down on that sentiment, stating in a …
midasletter.com
 
1:30 mark -

  • Bell Potter maintains a BUY rating on Allkem (ASX:AKE) and have lowered their price target from $19.45 to $19.36. At AKE’s current share price of $12.25, this implies 58% share price growth in a year.

 
JohnDe said:
1:30 mark -

  • Bell Potter maintains a BUY rating on Allkem (ASX:AKE) and have lowered their price target from $19.45 to $19.36. At AKE’s current share price of $12.25, this implies 58% share price growth in a year.

Click to expand...

Yikes, that's about a $12b MC. Not sure how they come up with that. Bell, obviously don't agree with GS on Lithium prices over the next year or so. Lithium is on RIO's radar, I wonder if this could be a bolt on for them.
 
This has sunk like a stone with the price of lithium and all the fuss about reduced demand and potential oversupply. But, in the end, my guess is the current producers and advanced developers will survive dramatic corrections in the overall market while the S&D works itself out.

The sweet TO offer for LTR today certainly put a rocket under a lot of lithium plays and must put a question over what comes next with M&A in the sector. As said above, RIO have said they're on the lookout and I don't think they'd be after early explorers but assets that are set in stone with long life assets.

Still don't trust either side of the fence on the short term price movements of lithium though. There's just so much going on with geopolitics and economics it's just a aguessathon, IMO.
 
I've sold into this unjustified bounce back to $12 with a small profit. But as they say...

I'll revisit when I understand the market a bit better and the institutions don't have these things on the short list.
 


With BHP’s $9.6bn buyout of OZ Minerals finalised earlier this month, some in the market are questioning what next when it comes to major miners embarking on mergers and acquisitions.

One target that could be on Rio Tinto’s radar is the lithium miner Allkem. Its market value is $7.2bn and the $164bn miner Rio could make a play, according to a source.

Attractive to Rio is the fact that it operates in the lithium space – Rio Tinto is known to have been keen to further invest in lithium for some time and there were sources suggesting last year it was looking at targets.
 
Didn't see this one coming. Can't see RIO or Captain Chaza changing this plan.

 
Some local prick here got in before this. I accidentally opened his acknowledgement letter today of new banking details for his AKE and PLS holdings. His P.O box 384, mine 284.

Not Held
 
This seems like a lot of inflation...




Last month, Allkem posted an annual profit of $US524.6 million – up from $US334.7 million, having recorded revenues of more than $US1.2 billion. The results came on the back of a stronger second-half performance from its Mt Cattlin mine at Ravensthorpe in Western Australia.

But Allkem, and the broader critical minerals sector, are facing climbing costs just as the competition for the clean energy metals heats up. Capital expenditure at Allkem’s James Bay project in Canada leapt by $US104 million, while costs at its Argentinian projects Sal de Vida, rose by $US 97 million, and Cauchari increased by $US213 million, the company said.
 
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