Look-alike Lithium Explorers Give Platypus Minerals Chance to Shine

Proliferating early stage lithium explorers have complicated choices for investors. With rapid re-pricing of stocks in response to announcements containing the magic word ‘lithium’, investors have usually had little time to think about geological merits before reacting. Investors also face some long waits for development, leaving them with high opportunity cost risks. Choosing is tough. Platypus Minerals is one of the most recent entrants into this lithium space. It carries all the risks of the others but has one important differentiating feature: it is merging with a privately held company with a mineral extraction technology capable of processing hitherto uncommercial lithium-bearing ores. A PortfolioDirect report dated 13 May 2016 gave the company a mid-range quality rating with a high risk rating pending the outcome of a shareholder meeting next week and a hefty issue of new shares. Until then, investors should tread cautiously. After that, there will be scope for rating upgrades as risks come down and the company shows how it can differentiate itself from the growing number of lithium look-alikes by taking advantage of its unique positioning.