The ASX penny stock Carbon Revolution Ltd (ASX: CBR) has experienced a remarkable surge in its share price, increasing by 84%. On the previous day, the Carbon Revolution share price closed at 12.5 cents but rose to an intraday high of 23 cents the following morning. At the time of writing, it stands at 16.5 cents per share, marking a 32% increase.
In contrast, the S&P/ASX 200 Index (ASX: XJO) has experienced a 0.57% decline in late afternoon trading.
What's driving the rise of this ASX penny stock?
Carbon Revolution (ASX:CBR), headquartered in Geelong, is a company that manufactures carbon fibre wheels for the global automotive industry. Investors seem to be flocking to Carbon Revolution shares following the company's successful procurement of US$60 million through a new debt program.
This funding is intended to support large-scale automation and capacity expansion, in addition to covering general corporate and working capital expenses of up to US$37 million.
Carbon Revolution has collaborated with underwriter PIUS Limited to secure this multi-million dollar financing. This funding ensures the company's financial stability, both leading up to and following its planned merger with Twin Ridge Capital Acquisition Corp.
Carbon Revolution's CEO, Jake Dingle, expressed his thoughts on the matter, saying:
"Working with PIUS and our merger partners at Twin Ridge Acquisition Corp. has enabled us to access a specialised form of non-dilutive financing that leverages the strong base of intellectual property that we have developed through extensive research and development, and technology commercialisation, over the past fifteen years."
The merger between Carbon Revolution and Twin Ridge Capital is anticipated to be completed by July 2023. In the third quarter of FY23, Carbon Revolution initiated a new wheel program and resumed the production of the Corvette ZO6 wheel. The company is known for manufacturing lightweight carbon fibre wheels for some of the world's finest and most sought-after automobiles.
Share price overview
Over the past year, the Carbon Revolution share price has experienced a 64% decrease. However, in the last week, it has seen an impressive 26% surge. As an ASX penny stock, Carbon Revolution has a market capitalization of approximately $36 million.