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Highlights
- Shares of Sayona were trading 8.18% higher at AU$0.29 per share on ASX today (24 August) at 2.21 PM AEST.
- The rise in Sayona’s share price could be because of the overall increase in demand of lithium.
Despite dipping below its 20-day moving average, the S&P/ASX200 was up 37.60 points or 0.54% to 6,999.40 points at 1.50 PM AEST today (24 August 2022).
On the sectoral front, eight of 11 sectors were trading in the green zone, and materials sector was one of the top performing sectors today at 1.51 PM AEST.
Meanwhile, ASX 200 Materials Index was 1.04% or 170.30 points up at 16,535.60 points at 1.52 PM AEST.
Why is Sayona's share price rising?
Sayona Mining (ASX:SYA) shares were trading 8.18% higher at AU$0.29 per share on ASX today at 2.21 PM AEST.
There is no new announcement made by the company today in fact, after 5 August, the company did not share any news which could impact its share price.
The share price hike might be because the overall demand for lithium is increasing, and its prices are also rising. Today at 1.55 PM AEST, lithium price was CNY487500/T. This means that lithium price has risen 2.52% on a monthly basis and around 347% Y-o-Y.
These strong developments in the lithium market came after Pilbara Minerals released its FY22 results report yesterday (23 August). The company reported AU$1.2 billion in revenue, AU$814.5 million in profits before interest, tax, depreciation, and amortisation (EBITDA), and a net profit after tax of AU$561.8 million.
For the rest of the market, Pilbara's investors' presentation revealed that a 1.8 million metric ton lithium shortage is likely to be reached by 2040.
This might be another reason for an increase in Sayona's share price that one of its peers released good results.
Image source: © Malpetr | Megapixl.com
Other lithium companies’ performance
Shares of Pilbara Minerals (ASX:PLS) were trading 4.59% higher today at AU$3.42 apiece on ASX at 2.05 PM AEST.
Other lithium companies like Allkem (ASX:AKE, +5.39%) Piedmont Lithium (ASX:PLL, +7.32%) and Core Lithium (ASX:CXO, +2.58%) were trading in the green today at 2.06 PM AEST.
A look at Sayona's recent developments
Sayona Mining announced few days ago (5 August) that it has inked an agreement with Acuity Capital to extend and enhance the size of its At-the-Market Subscription Agreement (ATM). The expiration date has been kept as 31 July 2025 and the limit of the ATM facility is AU$200 million.
Earlier it was reported that Sayona will receive up to AU$50 million in standby equity capital from ATM and it would expire on 31 July 2023.
On 4 August 2022, Sayona Mining had made significant progress in restarting spodumene (lithium) production at its North American Lithium (NAL) facility in Québec, with roughly 30% of plant and equipment modifications now completed.
After investing over AU$100 million in the restart, Sayona is on target to resume production in Q1 2023, becoming the only domestic supplier in North America. Sayona had commitments of CA$33.7 million as of the end of June, compared to the planned budget of CA$37.2 million, as elements including classification screen installation, apron feeder, grizzly, and chutes installation were finished in July.
