Original-Research: Rock Tech Lithium Inc (von GBC AG): Buy

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Original-Research: Rock Tech Lithium Inc - von GBC AG

Einstufung von GBC AG zu Rock Tech Lithium Inc

Unternehmen: Rock Tech Lithium Inc

ISIN: CA77273P2017

Anlass der Studie: Research Report (Initial Coverage)

Empfehlung: Buy

Kursziel: 1.47 EUR

Letzte Ratingänderung: -

Analyst: Marcel Goldmann, Cosmin Filker

The current environment for Rock Tech is very promising. Decreasing

lithium-ion battery prices, higher ranges, stricter environmental laws,

increasing quotas for the sale of electric vehicles and government

subsidies are increasing the demand for electric vehicles, and thereby also

lithium, as large quantities of this metal are used in electric vehicle

components. The market for electric vehicles is a relatively young market

and has recently shown dynamic growth. We expect that the electric vehicle

market will continue its strong growth in the future and secure a

significant market share in the overall automobile market in the long term.

Against this background, we expect very strong lithium demand from the

automobile market in the long term.

However, the demand for lithium is not only influenced by the automobile

market. Other new markets, such as the e-bikes market and the fixed energy

storage market require larger quantities of lithium for batteries. These

markets are also proven growth markets that have performed extremely strong

in recent years. We also expect continued significant growth for these

markets in the long term, which should, in parallel, also reflect in strong

demand for lithium. These new markets will therefore, in our view, provide

added impetus for lithium demand.

The increasing demand for lithium is also reflected in the market price for

lithium carbonate (the most used type of lithium). The price has exploded

between 2014 and today increasing by almost 200% to around USD 14,000/

tonne. Due to the continuing increase in demand for lithium from various

sectors and a continuing limited supply of lithium, we expect the lithium

price to remain at a very high level over the long term.

Given this excellent environment, Rock Tech has made the necessary

preparations to benefit from this strong trend. The lithium deposits at

Georgia Lake, purchased in 2009, have been further developed. The

historical resource estimates were converted to NI-43-101-compliant

resource estimates and confirmed. In addition, intensive exploration work

started at the end of 2016 in order to significantly expand the current

resource base. Also, additional commodities asset purchases are planned in

order to further extend the current resource base.

Rock Tech's core business is to further develop promising commodity assets

(in particular in lithium) that are still at an early stage, acquire them

and promote them further. The primary aim is not to mine commodities

itself, although it can be an option in individual cases, in order to

achieve the best shareholder return.

Based on the current 9.5 million tonnes in NI-compliant lithium resources

and the excellent framework conditions (e-mobility megatrend, strong

lithium price increase), according to our DCF model, we regard the current

fair value of Rock Tech Lithium Inc. to be CAD 2.15 or EUR 1.47. Based on

the current share price (1.10 CAD/0.77 EUR), this results in a high price

potential and therefore BUY rating. We believe even that Rock Tech has good

opportunities for expanding its NI-compliant resource base within the next

12 months and this could further enhance the value of the company.

Die vollständige Analyse können Sie hier downloaden:

http://www.more-ir.de/d/15473.pdf

Kontakt für Rückfragen

Jörg Grunwald

Vorstand

GBC AG

Halderstraße 27

86150 Augsburg

0821 / 241133 0

research@gbc-ag.de

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http://www.gbc-ag.de/de/Offenlegung.htm

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