IGO has announced that it does not expect to receive a cash dividend from the TLEA (Tianqi Lithium Energy Australia) JV (IGO 49% interest) in FY25. Ongoing issues with the production ramp up at the Kwinana Lithium Hydroxide Refinery post the major shutdown in October, capital commitments to the expansion at Greenbushes and weak demand which was seen a build-up of Lithium Hydroxide inventory are all key drivers behind the lack of a dividend. We have removed any cash payment in FY25 and extend this into the 1HFY26. Should the operational issues with the Kwinana Refinery persist beyond March 2025, we believe TLEA will look to placing the project on care and maintenance. Reducing Lithium Hydroxide sales widens our forecast loss for FY25, and we trim earnings in FY26 and FY27. The changes drive a modest 2% drop in our price target to A$6.30 and we reiterate our BUY rating on IGO.
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