Bushveld Minerals climbs 6% as investors look for growth stocks

The producer of vanadium saw its share price soar on Monday after announcing it is ramping up to full production last week and investors hunt for growth stocks amid the Covid-19 crisis.

Bushveld Minerals saw its share price close more than 6% higher on Monday after announcing it is ramping up to full production last week, with investors on the hunt for growth stocks amid the Covid-19 crisis.

The producer of vanadium has told investors that despite challenging market conditions, it remains on track to meet its 2024 target of 8,400 tonnes of production.

‘We used the lockdown period to strengthen our health and safety protocols together with business continuity measures, conducted maintenance and processed intermediary stockpiles, as per the guidelines received from our authorities,’ Bushveld Minerals CEO Fortune Majapelo said.

‘We are pleased that both Vametco and Vanchem are safely increasing production to normal levels,’ he added.

Not only is production looking strong, but the company’s balance sheet remains healthy despite the challenging environment, with the business establishing cash preservation measures to manage near-term liquidity, while preserving the long-term sustainability of its assets.

The company continues to review and limit operational expenditure where necessary as well as deferring growth associated (non-critical) capital expenditure.

Bushveld Minerals closed at 13p per share on Monday.

Bushveld Minerals 2020 outlook remains unclear

2020 production and cost guidance for both Vanchem and Vametco remains under review and will remain so until the company is in a position to quantify the impact of the Covid-19 pandemic and the South African nation-wide lockdown, the company said in its first quarter (Q1) trading update.

‘This update comes in the midst of the global Covid-19 pandemic that has not only changed our world but will continue to change it in ways we have not fully understood yet,’ Mojapelo said.

‘I am pleased that these difficult circumstances found Bushveld Minerals in a sound state financially, with a set of quality low-cost production assets,’ he added.

Despite the impact of Covid-19 crisis, the vanadium price has been resilient. China's Purchasing Manufacturing Index indicated improved rebar production and demand driven by the restart in the construction sector, with China's rebar consumption tracking up 10% year-on-year as well as the country being a net vanadium importer during the month of March.

‘Looking ahead we expect vanadium demand to remain robust in the medium to long term spurred on by supportive fiscal stimulus and increased infrastructure investments,’ the company said.

The optimism surrounding Bushveld Minerals remains high among analysts too, with Peel Hunt reiterating its ‘buy’ rating for the stock in May.

How much does it cost to buy UK shares with IG?

There are three ways to ‘buy’ UK shares with IG: spread betting, trading CFDs or buying physical shares. The cost will depend on which method you choose. The table below illustrates how the costs to get exposure to £10,000 of Lloyds stock, which is equivalent to 16,000 shares (quoted at 62.5p a share).

Remember, spread bets and CFDs are derivatives, which come with higher risk and reward than investing.

Cost to get exposure to Lloyds stock

Spread betting CFD trading Share dealing
Action Buy £160 per point Buy 16,000 share CFDs Buy 16,000 shares
Capital required to open £2000 £2000 £10,000
Total fees £20.88 £20.88 £16

Ready to start trading shares? Open a live account or practise on a demo.

Note: Amounts do not include overnight funding charges and taxes. Spread bets are not subject to tax. CFDs are free from stamp duty, but subject to capital gains tax. Share dealing is subject to both stamp duty and capital gains tax.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
liveprices.javascriptrequired
liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.