LAKE RESOURCES N.L. (LKE)
Share Price Analysis and Chart

16/08/2023

1

Buy

$0.36

176.92%

Lake Resources has published a Preliminary Assessment of its Kachi Lithium Brine Project in Argentina and it's not good news.

The assessment follows major management and board resets, which Bell Potter says, in combination with the assessment,  have negatively affected the size and timing of the project.

The Definitive Feasibility Study, now due by the end of this year, will address a 25ktpa Lithium Carbonate project, down from 50ktpa, prior to the preliminary assessment (with potential for a later 25ktpa stage); and first production has been postponed to 2027 from 2024.

The capital expenditure bill has blown out to -US$1.1-US$1.5bn, compared with -US$544m in March 2021; and operational expenditure forecasts have increased to US$4,700 to US$7,100/t, from US$41.78/t.

Bell Potter ascribes no value to the aired second stage but appreciates the company's value leverage to medium-term lithium markets, and the success of its potentially disruptive emerging lithium processing technology, which the broker says brings ESG benefits.

Buy rating retained. Target price cut to 36c from $2.52.

FORECAST
Bell Potter forecasts a full year FY24 dividend of 0.00 cents and EPS of minus -3.00 cents.