IGO’s underlying Ebitda for the 1HFY25 was in line with our estimates. Impairments relating to Train 2 at the Kwinana Lithium Hydroxide refinery and exploration assets were larger than we expected, which pushed the net loss for the 1HFY25 to A$78m. Greenbushes, which accounts for +85% of our valuation, and our positive outlook for spodumene prices is the key driver behind our positive view on IGO. The future of the Kwinana Lithium Hydroxide refinery remains uncertain, with closure and a complete write down a potential outcome should production rates not improve. Nova’s outlook has also deteriorated however we note that these two assets combined account for just 6% of our valuation for IGO.
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