ION Energy Ltd’s flagship Baavhai Uul lithium project in Mongolia has promising potential to be a future supplier to the electric vehicle (EV) industry, according to analysts at Couloir Capital who have reiterated their ‘Buy’ rating for the company.
In a research note, analysts wrote that ION’s maiden auger drilling program at Baavhai Uul had returned a number of high-grade lithium highlights and significant copper and nickel values, opening up the possibility of developing other EV-related minerals at the property.
They noted that the company has also commenced drilling at its Urgakh Naran property, with early indications pointing to high-grade lithium potential.
READ: ION Energy collects highest-grade lithium brine sample ever seen in Mongolia at its Urgakh Naran project
“Early brine samples have returned promising values, with a shallow pool sample from the site being one of the highest-grade samples collected in the country, according to management,” analysts wrote.
“We expect that positive findings at Urgakh Naran could build upon positive results from the 2021 drilling at Baavhai Uul, and build a growth platform for ION to leverage in future exploration.”
Further, analysts wrote that ION’s joint venture with copper exploration company ARJN, which it entered into on February 1, 2022, presented a number of opportunities to ION over the long-term.
Noted benefits included allowing ION to diversify its exploration exposure over a greater number of properties while allowing the company to remain nimble in its exploration focus and an implied increase in opportunities to identify economic ounces in the ground.
After taking into account their valuation methodologies, Couloir Capital analysts updated their fair value per share estimate for ION from $1 per share to $1.12 per share.
ION Energy is exploring and developing Mongolia’s lithium salars as the company positions itself to be a leader in clean energy amid a global rise in demand for lithium.
Shares of ION were trading around C$0.32 on Wednesday afternoon.
Contact Emily at emily.jarvie@proactiveinvestors.com
Follow her on Twitter @emilyjjarvie