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- The global EV sales grew by 55% during the December quarter, surpassing all the estimates.
- Europe and China are together contributing to 85% of the total market share in the EV segment.
- To leverage the EV boom investors are looking into the EV ecosystem and the resources industry seems to be in a sweet spot.
- Lithium miners are among the top gainers as it is the building block of battery technology.
The surge in demand for EVs superseded all estimates during the December quarter. China and Europe are the main growth engines and now together represents 85% of the global EV market. In terms of number, 3 million units were alone sold in 2020. The industry is forecasted to increase at a much steeper rate and is expected to reach 26 million units annually by the year 2030.
The numbers are quite intriguing, and investors are focusing their portfolio allocation on battery and EV segment. But when we talk about Australia, there are not many listed car companies that are into electric segments. Still, the investors can have their share of the EV boom pie through research and data collection.
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For making a reliable EV, batteries have now become the one of the most important component of the car. Lithium is used in the making of an EV battery, and Australia is the largest global supplier of lithium. Metals like nickel and cobalt are also important to the EV sector, but we will limit today’s discussion on lithium stocks only.
Orocobre Limited (ASX:ORE) is a large scale producer and exporter of lithium, having its operations in Argentina, Japan and Australia. The Company produces lithium carbonate in Argentina and has an lithium hydroxide unit in Japan in the pipeline.
The shares of the Company crossed their 52-week high today and reached A$5.97. With this new high, the Company’s market cap crossed the A$2billion mark on the bourse. In the last one year, Orocobre has yielded an excellent return of 170% to its shareholders. The Company benefitted from the surge in demand for EVs.
The next one in the queue has given a 500% or 6x return. The Company owns and operates one of the World’s largest hard rock lithium projects in Australia. If you have not guessed the name yet, allow us to reveal the name- Pilbara Minerals Limited (ASX:PLS).
The Pilgangoora Project in Western Australia is a low cost source of lithium. The Company shipped a record 114,239 dry metric tonnes (dmt) of spodumene during the 1H of FY21.
The shares of the Company gained 5.5% today, and the share price are in uptrend on the long term chart. PLS closed the day’s trade at A$1.24 with a market cap of A$3.4 billion as of today.
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Then there is Anson Resources Limited (ASX:ASN) with 1 year return of 200%. The Company has its operation in U.S.A. ASN is consolidating at current price of A$0.078.
Latin Resources Limited (ASX:LRS) is another penny stock in lithium sector that has gone up 1500% in one year. A year back, the stock of the Company was hovering around A$0.003. The rise in demand in lithium pushed the stock prices up to current level of A$0.049.
Galaxy Resources Limited (ASX:GXY) is also a lithium player with operations spread across three continents. The Company has operations in Canada, Argentina and Australia. Galaxy is also trading at its new 52 week high and in today’s trade it gained more than 8%. The stocks of the Company have yielded 350% return to its shareholders in the past one year. Currently the shares of the Company are trading at A$3.53 with a market cap of A$1.64 billion.