In an exciting development, a smallcap stock listed on the S&P BSE 500 index experienced a 3% surge in its share price on Monday following a press release announcing its foray into the Lithium Ion Storage Cell Industry. With a market capitalization of Rs. 11,267 crore, the stock witnessed trading volumes that were twice the previous session’s and well above last week’s average.
Closing at Rs. 441.70, the stock marked a 2% increase from its previous closing price. Moreover, Shyam Metalics & Energy Ltd, the company behind this strategic move, received a target price of Rs. 690 from ICICI in August, indicating a potential upside of 56% from its current market value.
Shyam Metalics & Energy Ltd, a prominent integrated metal producer headquartered in Kolkata, has set its sights on becoming a key player in the energy storage sector, particularly in the domain of battery-grade aluminum foil production. This strategic initiative aligns with the company’s ambition to contribute significantly to the Indian government’s Atma Nirbhar Bharat (Self-Reliant India) initiative within the battery energy storage industry.
With an impressive annual production capacity of 20,000 tons, Shyam Metalics specializes in the manufacturing and export of aluminum foil, catering to diverse industrial applications. This strategic move positions India to secure a substantial share of the raw material market within the rapidly expanding lithium-ion cell industry, which is projected to reach an impressive 6500GWh/year capacity by the year 2030.
The significance of aluminum foil in lithium-ion cells cannot be overstated. To produce 1GWh (Gigawatt-hour) of Lithium Iron Phosphate (LFP) cells, which power a wide range of electric vehicles and energy storage systems, 350 tons of high-purity and uniform-thickness aluminum foil are required. This specialized aluminum foil plays a critical role as the positive (cathode) current collector. Furthermore, the demand for sodium-ion batteries is expected to surge, as aluminum foil is anticipated to serve as both the positive and negative current collectors in these batteries.
Shyam Metalics has subjected its customized battery aluminum foil to rigorous third-party laboratory testing, validating its suitability for various applications. The foil is available in a range of thicknesses, spanning from 12-micron to 20-micron, ensuring versatility and compatibility with diverse battery technologies.
Moreover, Shyam Metalics possesses state-of-the-art German machinery capable of producing aluminum foils with a remarkable thinness of 6-micron. This capability positions the company to meet evolving requirements in the lithium-ion cell sector, where the trend is toward thinner foils. Thinner foils contribute to enhanced cell gravimetric energy density, reflecting the amount of energy stored per unit weight of the cell and measured in Watt-hour/Kilogram.
This strategic move by the smallcap stock underscores the company’s commitment to diversification and innovation in a rapidly evolving market. By venturing into the lithium-ion storage cell industry, Shyam Metalics aims to not only expand its business horizons but also play a pivotal role in India’s quest for self-sufficiency in critical industries. As the lithium-ion cell sector continues to grow, driven by the surge in electric vehicles and renewable energy solutions, Shyam Metalics appears poised for a promising future as a key player in the supply chain of essential materials.
