| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 50.24 | 704 |
| Intrinsic value (DCF) | 15.60 | 150 |
| Graham-Dodd Method | 0.06 | -99 |
| Graham Formula | n/a |
Tirupati Graphite plc (LSE: TGR) is a London-based specialist graphite and graphene producer with key operations in Madagascar and India. The company focuses on high-purity flake graphite production, catering to critical industries such as lithium-ion batteries, fire retardants, composites, and thermal management solutions. With flagship projects like Sahamamy and Vatomina in Madagascar, Tirupati Graphite is strategically positioned to capitalize on the growing demand for graphite in green energy applications, particularly in electric vehicle (EV) battery supply chains. The company has also established a research collaboration with Monash University to advance graphene applications, reinforcing its innovation-driven approach. Operating in the Industrial Materials sector, Tirupati Graphite plays a pivotal role in the global transition to sustainable energy, leveraging Madagascar’s rich graphite reserves. Despite its early-stage challenges, the company aims to become a vertically integrated supplier, addressing supply chain vulnerabilities in critical minerals.
Tirupati Graphite presents a high-risk, high-reward opportunity tied to the EV and energy storage boom. Its Madagascar-based projects offer access to high-quality flake graphite, a critical material for anodes in lithium-ion batteries. However, the company’s financials reflect significant losses (£2.37M net income deficit in FY2023) and negative operating cash flow (£2.17M), exacerbated by heavy capital expenditures (£5.43M). While its beta of 0.849 suggests lower volatility than the market, liquidity constraints (cash reserves of £0.29M against £2.80M debt) and lack of dividends may deter conservative investors. Success hinges on scaling production, securing offtake agreements, and navigating geopolitical risks in Madagascar. Investors bullish on graphite demand—especially from the EV sector—may find speculative value, but operational execution remains a key hurdle.
Tirupati Graphite competes in a niche but increasingly competitive flake graphite market, where scale, purity, and cost efficiency determine leadership. Its primary advantage lies in owning high-grade deposits in Madagascar, a region with untapped potential but infrastructural and regulatory risks. Unlike synthetic graphite producers (e.g., SGL Carbon), Tirupati focuses on natural flake graphite, which is cheaper to produce but requires beneficiation for battery-grade quality. The company’s small scale compared to giants like Syrah Resources (ASX: SYR) limits its bargaining power with OEMs, though its UK listing provides access to capital markets. Tirupati’s R&D partnership with Monash University could differentiate its graphene offerings long-term, but commercialization remains distant. Competitors with vertically integrated operations (e.g., Talga Group) or offtake partnerships (e.g., NextSource Materials) are better positioned to meet automakers’ supply chain demands. Tirupati’s lack of revenue diversification beyond graphite—unlike Nemaska Lithium’s multi-mineral approach—heightens commodity price risk. To compete, it must accelerate production ramp-up and secure strategic alliances in the EV battery space.