Close menu

September 7th, 2022 | 10:58 CEST

Edison Lithium, Rock Tech Lithium, BYD - Shares of the entire lithium value chain

  • Mining
  • Lithium
  • Electromobility
Photo credits:

Since all car companies have entered the e-mobility market, the demand for batteries for electric vehicles has skyrocketed. An all-out battle has broken out for the components needed for this, which is reflected above all in the price of lithium. While the price was around USD 5,000 per ton at the end of 2020, it was most recently quotes around USD 73,000. Experts even consider further price increases up to USD 100,000 possible because demand is significantly higher than supply. The German Federal Institute for Geosciences and Natural Resources also comes to this conclusion. The lithium market promises to remain exciting in the coming years. Therefore, today we look at three companies along the value chain.

time to read: 5 minutes | Author: Armin Schulz
ISIN: Edison Lithium Corp | CA28103Q1090 , ROCK TECH LITHIUM | CA77273P2017 , BYD CO. LTD H YC 1 | CNE100000296

Table of contents:

    Edison Lithium - Property in the South American Lithium Triangle

    Lithium has long been needed to produce lithium-ion batteries, which are used in laptops, cell phones, tablets and wireless headphones, for example. However, unlike the battery in an electric car, these devices are much smaller and consume much less of the precious raw material. Lithium itself is common, but much rarer in the quantity that it can be mined in an economically viable way. The Canadian explorer Edison Lithium owns two promising lithium brine deposits in Argentina, located in South America's famous Lithium Triangle. Livent is already producing lithium in the immediate vicinity.

    The main project, called Antofalla, covers 107,000 hectares and is located in the Salar de Antofalla, one of the largest salt pans in the world. According to Albemarle Corporation, the world's third largest lithium brine reservoir is located there. Edison Lithium's property is therefore optimally positioned. In total, there are results from 56 historical drill holes that have produced resources amounting to 83 million tons of potash with an ore grade of 6,400 mg/l and 2.22 million tons of lithium with a grade of 350 mg/l. The second lithium project, Pipanaco, is located 50 km west of the town of Catamarca and has been little explored. However, the site could be considered for a lithium processing plant.

    In addition to the lithium projects, the Company owns a cobalt deposit in northeastern Ontario, Canada. The property is home to three historic mines demonstrating cobalt grades up to 4%. The project is to be separated from Edison Lithium via a spin-out, and existing shareholders will receive shares in the new company. With an investment in Edison Lithium, one can secure two critical raw materials for the future of electromobility at the same time. The share is currently quoted at CAD 0.07 and thus has a market capitalization of just CAD 8.1 million. If exploration data is positive, the Company could quickly find itself in the sights of the major local lithium players.

    Rock Tech Lithium - Go-ahead for the construction of the converter

    Rock Tech Lithium also originally started with a lithium mining project, but today the focus is on a lithium refinery to be built in Guben in Brandenburg. The first lithium converter in Europe will go into production by the end of 2024. Four more are to follow by 2030. The aim is to secure European supply chains, especially for automakers. In doing so, the Company is pursuing a holistic approach and already has recycling in the pipeline, even though the topic will not really become important until 2025/2026. Talks are already underway with suppliers to this end. The management is trying to implement the vision of a closed-loop company with zero waste.

    For example, by-products generated during production could be sold to the concrete industry and positively contribute to profits. Internally, the Company conservatively expects sales prices between USD 20,000 and 30,000 per ton of lithium hydroxide. If it proves true that the processing of the lithium is the bottleneck, prices are likely to be significantly higher in the future as well. In October, the first steps will begin for construction at the Guben site, which has been carefully selected and offers advantages in logistics, proximity to customers and more. In addition, the Company has options on other lands for possible expansion. The converter is scheduled to go into production at the end of 2024, and the lithium mine should be ready by the same date.

    Supervisory Board Chairman Dirk Harbecke told our editorial team, "We will be able to sell our lithium hydroxide with very good margins from the first day of production. The demand from the global car and battery companies for our product is increasing almost daily. The market is incredibly dynamic, and we are building a new industry with world-renowned strategic partners like Mercedes-Benz." On August 23, it was announced that the Stuttgart-based automaker plans to purchase 10,000 metric tons of lithium hydroxide annually starting in 2026 as part of the intended binding agreement. This news gave the share price a brief boost. The previously implemented capital increase caused pressure from Canada, so the gains were given up again. At a share price of CAD 3.36, one can now access more favorably than at CAD 3.50 during the capital measure.

    BYD - New sales record

    BYD grew up as a battery producer before the development of electric cars began. This technological lead has presumably even persuaded Tesla to install the Chinese company's blade batteries in the future. Various media recently reported that this would be the case from 2024. After recently overtaking Tesla in terms of sales figures, the Company is now also gaining ground in the sale of batteries for electric cars. For a long time, BYD was only considered No. 3 among battery manufacturers, but in July, it secured second place and increased its market share by 2.2% to 16.2%. CATL is in the lead with 33.5%.

    In terms of sales figures, the Group continues its record chase. In August, 174,915 vehicles were sold, an increase of around 185%. That means more than 1 million electric vehicles have been sold this year. The first vehicle from the joint venture with Mercedes-Benz, the Denza D9 MPV, is also scheduled for delivery starting in September. By the end of next year, the CEO wants to have sold 4 million electric vehicles. To this end, the Company is continuing to invest in expanding production capacity, including EUR 4 billion in a mining and battery project in Yichun.

    One can see that BYD is also trying to expand its value chain to operate independently. Despite all the good news, the stock is clearly under pressure. Warren Buffet, who has been invested in the Company since 2008, is selling the stock. Investors fear that the Oracle of Omaha could sell all his shares. That would not only put additional pressure on the share but would also tempt Buffet imitators to sell. Already, the short ratio in the share has risen. At the moment, one is paying EUR 28.42 for a share certificate. At the beginning of July, it was still EUR 41.80.

    The lithium market will remain volatile for a while. The question remains how long it will take until enough lithium can be produced to meet demand. Edison Lithium has a property in what is said to be the world's third largest lithium brine reservoir. The next set of drill results will be interesting here. Rock Tech Lithium is turning the big wheel by going after the bottleneck of lithium processing. High profits beckon here. As a battery producer and electric vehicle manufacturer, BYD is dependent on lithium and is also investing in this area.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and the like on These contents are exclusively for the information of the readers and do not represent any call to action or recommendations, neither explicitly nor implicitly they are to be understood as an assurance of possible price developments. The contents do not replace individual expert investment advice and do not constitute an offer to sell the discussed share(s) or other financial instruments, nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but a journalistic or advertising text. Readers or users who make investment decisions or carry out transactions on the basis of the information provided here do so entirely at their own risk. No contractual relationship is established between Apaton Finance GmbH and its readers or the users of its offers, as our information only refers to the company and not to the investment decision of the reader or user.

    The acquisition of financial instruments involves high risks, which can lead to the total loss of the invested capital. The information published by Apaton Finance GmbH and its authors is based on careful research. Nevertheless, no liability is assumed for financial losses or a content-related guarantee for the topicality, correctness, appropriateness and completeness of the content provided here. Please also note our Terms of use.

    Der Autor

    Armin Schulz

    Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.

    About the author

    Related comments:

    Commented by Armin Schulz on September 27th, 2023 | 09:05 CEST

    Nikola, Saturn Oil + Gas, BASF - A Buy in difficult times?

    • Mining
    • Oil
    • Batteries
    • renewableenergies
    • chemicals

    These are challenging times on the stock market. Central banks have not announced the end of interest rate hikes, which is poison for growth companies. In addition, extreme weather conditions are affecting the production of some companies, and there are geopolitical tensions to consider, including the ongoing Ukraine conflict and the simmering dispute between the US and China. Recently, there have also been tensions between China and Germany. Following critical statements by Foreign Minister Baerbock to China's Xi Jinping, the German ambassador was summoned. Energy shortages are becoming increasingly significant for many companies in Germany. Today, we look at three companies suffering from the problems described.


    Commented by André Will-Laudien on September 27th, 2023 | 08:05 CEST

    The high-tech gold rush on the Nasdaq is waning: BYD, Manuka Resources, and Infineon remain on the buy list

    • Mining
    • Vanadium
    • Electromobility
    • Technology
    • GreenTech

    For those investing in green or high-tech sectors, keeping an eye on the supply chains of raw materials is crucial. After all, in times of geopolitical upheaval, nothing seems more important to the industry than securing its foreign sources of critical resources. The EU and the US have already responded by adding several metals to the list of strategic elements. For the capital markets, too, the fight against global warming has become an issue that cannot be ignored. We focus on successful protagonists that can enhance any portfolio.


    Commented by André Will-Laudien on September 26th, 2023 | 07:45 CEST

    Artificial Intelligence in Sellout! Nvidia, Defense Metals, ARM Holdings - Nothing works without rare earths!

    • Mining
    • RareEarths
    • AI
    • chips
    • Investments

    After long bull market movements, the stock market usually tends to rotate sectors, or the market enters a general consolidation. In the former case, investors can profit by reallocating their assets while exploring new investment opportunities. In the latter case, all stocks come down, and the capital market generally suffers from a change in sentiment and corrects recently exaggerated valuations. In the case of the new megatrend of Artificial Intelligence (AI), the stock market seems to sense a great need for correction. As if by magic, the blockbuster stock Nvidia rose by 250% in just 9 months. However, it has already retraced nearly 20% from its peak. Where do the opportunities lie for investors?