Volt’s recent pre-feasibility study on Namangale outlines a 170ktpa operation feeding a high-purity graphite concentrate into the lithium-ion battery (LiB) and expandable graphite end-markets. We have compared Namangale to six of the most advanced East African graphite projects and note Volt’s high ranking in terms of estimated operating margin and concentrate purity. We note the project’s slightly above average capital intensity, but also that it is c 17% lower than Magnis Resources’ BFS-stage Nachu project situated close by. We initiate coverage on Volt with a fully diluted (50/50 debt/equity split) valuation of A$264m or 27 cents per share, using a 10% discount rate and US$1,684/t concentrate basket price. Volt has also secured a binding off-take agreement with a graphene developer, which we view as technically de-risking Namangale graphite for use in high-value and high-tech applications.

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