The Syrah share price is currently trading higher after the company released its quarterly report to the ASX.
The post The Syrah (ASX:SYR) share price is up 8% today. Here’s why appeared first on The Motley Fool Australia. –
Shares in the miner are currently trading 7.9% higher, reaching a price of $1.30 at the time of writing.
Syrah is an Australia-based industrial minerals and technology company. Its two facilities include the Balama graphite project in Mozambique, which has suspended production since March 2020 due to impacts from the COVID-19 pandemic on travel and workforce. The other, which is not yet operational, is the Vidalia facility in Indiana, the United States.
Why is the Syrah share price rising?
A number of points in the quarterly report may be contributing to the Syrah share price rise today.
Firstly, its US-based Vidalia project was significantly de-risked after completion of a bankable feasibility study. The study highlighted the project’s strong economics.
Syrah also achieved first production of active anode material (AAM) from the Indiana facility during the quarter. The AAM was produced to target specifications and dispatched to electric vehicle supply chain participants. These include Tesla Inc (NASDAQ: TSLA) and Nio Inc (NYSE: NIO).
In addition, the company is assessing a potential restart to production at the Balama facility. Syrah noted that any restart will not take place until 2-3 months after any announcement is made.
As a result, Syrah advised it “remains on track to become a vertically integrated producer of natural graphite AAM to service ex-Asia markets”.
While not currently producing graphite, Syrah aims to join ASX graphite producers such as Talga Group Ltd (ASX: TLG) and Novonix Ltd (ASX: NVX) in supplying both traditional graphite markets and emerging technology markets across the globe.
In today’s release, Syrah said graphite market conditions had improved once again in the quarter, with higher prices being observed.
Positive momentum in EV sales growth also continued during the quarter, which is a key leading indicator for natural graphite demand growth. The company noted that global EV sales grew 106% in the fourth quarter of 2020 and 89% year on year in H2 2020.
In addition, Syrah completed a $124 million capital raising during the quarter. As a result, its cash balance sits at US$75 million as of 31 December 2020.
Syrah will use the proceeds to progress its final investment decision regarding Vidalia for a large AAM plant. The funds will also be used for restarting Balama and general corporate purposes.
The Syrah share price smashed its 52-week high today, trading as high as $1.34. Despite falling back to $1.3, shares in the company are trading 127% higher for the year.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
- Why the Novonix (ASX:NVX) share price rocketed 36% higher to a record high
- 3 ASX shares powering the electric car revolution
- Here are the US shares ASX investors are buying
- Tesla debuts China-made Model Y SUV
- Here’s the biggest investment opportunity since the internet
Daniel Ewing has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.