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SMALL CAP MOVERS: Robot revolution bodes well for these three miners
We are on the cusp of a robot revolution. And that bodes well for an overlooked trio of junior members of the mining exploration community.
Let me explain. As robotics and automation gear up to double in scale by 2030, demand for rare earth elements, like neodymium and dysprosium used in electric motors, is soaring.
China currently controls around 70 per cent of the global rare earth supply, creating a geopolitical bottleneck that could disrupt the robotics revolution.
UBS earlier this week warned of a 'materials pinch point' as the world's appetite for automation and electrification grows, making miners and processors of these metals increasingly important.
It forecasts the global stock of industrial robots will nearly double to almost six million units by 2030, driven by falling costs, AI advances and labour shortages.
Rainbow Rare Earths, Harvest Minerals and Altona Rare Earths are among the UK companies quietly emerging as key players in the race to supply critical materials for the new industrial age.
While Rainbow and Altona continue to trade under the radar, it was a different story for Harvest, which skyrocketed 60 per cent this week.
This came after it reported more positive assay results from its rare earth exploration programme in Brazil and confirmed plans to accelerate drilling activity.
The AIM-listed mine developer said new tests on 36 historical samples from its Arapuá project, in Brazil, showed total rare earth oxide (TREO) concentrations ranging from 2,110 to 2,657 parts per million.
The samples also returned high titanium dioxide grades of up to 15.42 per cent, confirming mineralisation in a rock type known as 'Bone'.
The other two are making similar headway, which is yet to be rewarded. So, watch this space.
Now, turning to the wider market, the AIM All-Share was almost static at 761.13 as mounting tensions between Israel and Iran hit sentiment. The performance of the small-cap index mirrored that of the FTSE 100, which was also moribund.
It was a good week if you were looking to raise funds, particularly in the Bitcoin treasury space.
The stand-out was The Smarter Web Company, an Aquis-listed venture which came to the market with little fanfare in April as a provider of web services with ambitions in cryptocurrencies.
Those ambitions have been realised. Not only did SMC raise just under £30million in a massively oversubscribed City investment round, it also struck a deal that could see it access a further £80-odd million.
Smaller aspirants used interest in the sector to bolster their Bitcoin buying power. Vinanz raised £3.7million and Helium Ventures raked in £4million as did Coinsilium.
Usually, in the wake of chunky new share issues, stocks retrench. Not so with the quartet mentioned above.
Vinanz was the comparative 'laggard' with a 46 per cent gain, while the others saw triple-digit advances.
Onto the fallers. Down 41 per cent, the week's biggest casualty was Revolution Beauty, which tanked after Mike Ashley's Fraser's Group pulled out of the running to acquire the business.
Year-to-date, the stock has tumbled 72 per cent amid accounting issues and boardroom disputes.
It launched a formal sale process at the end of last month after receiving a preliminary takeover approach from an unnamed company.
It was also a week to forget for Litigation Capital, a fund set to back high-payout legal cases.
The shares fell 35 per cent after it announced a court defeat in one of its funded cases and flagged a sharp slowdown in investment returns in the second half of the financial year.
After a sharp rise in the stock price it was back to earth with a bump for investors in Karelian, which issued stock equivalent to 12.5 per cent of its share base to bring in a paltry £185,000.
The price dropped 32 per cent. Still, those invested a month ago are still sitting on a 48 per cent gain.
Finally, ACG Metals is quietly making progress, although the market has been slow to respond.
Giving investors a nudge, Canaccord Genuity has launched coverage with a 'buy' rating and an 830p price target, a 53 per cent premium to the current share price.
The key to achieving this valuation is the shift from gold to copper at its flagship Gediktepe project in Turkey.
The change, scheduled for 2026, will see ACG move from its current gold oxide production to a copper sulphide operation.
Canaccord describes a 'smooth transition at Gediktepe' as key to the investment case.
For 2025, ACG has guided for 30,000–33,000 ounces of gold equivalent at all-in sustaining costs (AISC) of around US$1,150 per ounce.
Canaccord is slightly more optimistic on output and believes cost performance could improve, particularly with a strong end to the year.
Although 2026 is forecast as a lower-margin year due to the transition, Canaccord expects robust cash flow to follow as copper production ramps up, with net debt peaking next year before rapid deleveraging.
With prices of the red metal strong and multiple 'de-risking' milestones ahead, Canaccord sees ACG as well placed for a re-rating if it can deliver on execution.
