Shares in Tirupati Graphite PLC (LSE:TGR, OTCQX:TGRHF) surged by more than 18% in early trade as the company announced that its second major operation in Madagascar, Vatomina, had reached commercial production.
The mine and process plant has capacity for producing 9,000 tonnes per year of flake graphite with a target grade of 96%, and more than 70% of the product is likely to be greater than jumbo large flake size.
The size of the flake is of extreme significance in graphite production, as it affects conductivity.
The company’s total primary flake graphite production capacity in Madagascar is now 12,000 tonnes per year, and is expected to reach 30,000 tonnes by the middle of next year, before reaching 84,000 tonnes by the end of 2024.
These plans include an additional 54,000 tonnes of capacity planned at Vatomina and the second 18,000 tonne module currently under construction Sahamamy.
This positions Tirupati as that rare company amongst junior miners – one that offers a realistic prospect of actual and measurable growth and over a defined timeline.
In that regard, Tirupati has been open about its expansion plans from the moment it listed last year, and that’s one reason why the shares are up by more than 60% since last December, and why when the graphite price has been stronger, they’ve been even higher.
So, is Tirupati developing a track record of delivering on its promises?
It seems so, although the promises still outstanding are pretty big.
The company aims to become one of the world’s only fully integrated producers and processors of graphite, and manufacturers of graphene.
In that regard it can talk justifiably of downstream and upstream operations, although to a degree investors who are only cognisant of matters mining may struggle to keep up with the high-level science involved in graphene production.
Easier to get to grips with though, is the company’s long-standing commitment to environmental and social governance. It’s long been engaged on a social level on the ground in Madagascar, and much of the power that it uses to run its operations is generated hydro-electrically.
So, all told, the company is ticking a lot of boxes that investors need ticked these days. Will it be a contender for next years ESG award at Mines & Money? Surely, somebody will be putting it forward.