Lithium Power (ASX:LPI) Research Update

Highlights:

• Arrowhead is updating its coverage on Lithium Power International Ltd. (“LPI”) with a fair value bracket of AUD 0.85 – AUD 1.04 (Share Price on 13 March 2023: AUD 0.30) based on Discounted Cash Flow Valuation and Comparable Company Valuation.
• LPI is a pre-revenue pure play, diversified lithium exploration, and development company involved in acquiring and advancing promising lithium projects. LPI currently has one brine asset in Chile (“MSB”) and three hard rock assets in Australia. LPI’s flagship MSB is among the most advanced development-stage projects. It is expected to enter the construction phase in late 2023 with production likely to begin in early 2026. The Company’s other three assets are currently in the exploration stage.
• Previously, LPI’s flagship project in Chile was under a JV named Minera Salar Blanco S.A. (MSB) between LPI, Borda Group, and Bearing Lithium (TSXV: BRZ). The Company consolidated 100% interest in the project through two all-scrip mergers with its JV partners in December 2022. As per the revised DFS on Old Code Concessions, the Stage One project can produce an average of 15,200 tonnes of battery-grade lithium carbonate per annum for 20 years.
• LPI is currently focused on negotiating financing options for construction at the MSB project. LPI has received several expressions of interest in relation to debt and equity funding from strategic investors, export credit agencies, and governmental bodies.
• MSB has obtained environmental approval as well as basic infrastructure permissions and approvals for water, roads, electricity, port, logistics, etc.
• LPI’s other assets in Western Australia are Greenbushes, East Pilbara, and Eastern Goldfield. The Company is planning to demerge these assets by H1’23 by forming a new WA-focused lithium exploration company and listing it on ASX.