Horizonte Minerals PLC (LON:HZM, TSE:HZM) is well positioned to benefit from the strong stainless steel and electric vehicle (EV) battery market outlook thanks to its two advanced stage nickel projects in Brazil, said analysts at Cormark Securities Inc as they initiated coverage.
“Horizonte’s targeted production start-up timing could not be better,” the analysts said alongside a “buy” recommendation and C$0.70 target price. The shares last closed at C$0.14 in Toronto.
“The flagship Araguaia project’s fully permitted status sets the stage for timely production start-up—currently targeted in 2024.
While Araguaia’s scaled 29 ktpa nickel profile is designed around ferronickel production for the ever-growing stainless steel market, the company’s complementary Vermelho project is poised to produce 24 ktpa nickel and 1.2 ktpa cobalt that will be suitable for the battery-grade sulphate markets— key metals underpinning the EV revolution.
“At +50 ktpa of contained nickel production, Horizonte’s scaled profile stands to represent about 2% of current global demand—a meaningful position on the global stage.”
Global nickel demand is expected to double by 2030, boosted by EV consumption, while there is anticipated to be a significant supply shortfall from 2025 following reserve depletion at a number of established operations and a lack of exploration investment, they said.