Only a few dozen pro football clubs trade publicly on exchanges overseas. The biggest is Manchester United at around AUD$5.9 billion, bigger than plenty of ASX 200 names.

You can also pick up shares in Juventus, Borussia Dortmund, Ajax, Celtic and Benfica.

A derby loss, a sacked manager, a marquee signing or a cup exit can all move the price. And every star in this tournament is a club asset on loan to his country for the month. If he comes home with a hamstring, his club wears it.

Share prices moving on a single piece of news. We know that game well.

Back in small-cap land, the news was dropping everywhere. A chip-industry milestone a decade in the making, a drone supplier planting a flag in Los Angeles right as Washington puts more than $50 billion behind drone production, thick copper out of Mongolia, and a maiden resource taking shape in Malawi.

A scandium resource grew off samples that had been sitting in storage for years. And in Canada, a tiny copper hunter pulled grades that sent us back through years of announcements looking for a precedent. We came up empty.

What caught our eye this week:

• AI1 cracks graphene below 300°C, the chip industry’s white whale

• KTK signs lease in US as Washington opens chequebook on drones

• MRD doubles its scandium grades off old drill pulps, no rig required

• AZ9 hits thick, high-grade copper in Mongolia

• FUN advances Mkanda on every front after landing a SpaceX-calibre backer

• WCN drills copper grades we can’t say we’ve seen before

• SpaceX lists and Elon becomes a trillionaire

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AI1 Harpoons the Chip Industry's White Whale

Graphene grows at around 1,000°C. A finished chip starts cooking past about 450°C.

That gap has held up the chip industry’s most wanted breakthrough for a decade.

Every advanced chip, from the processor in your phone to the ones filling AI data centres around the world, runs on copper wiring.

That copper has hit its physical limits as the chips keep shrinking, and graphene is the material everyone agrees should replace it.

But the one material that could save the chip could only be grown at a temperature that destroys it.

Until now.

Adisyn (ASX: AI1) ran its process three times on three separate days, and grew graphene below 300°C every time. No chipmaker will build a billion-dollar production line around a coating that worked one Tuesday and never again.

Then AI1 did the thing most small-caps avoid. It handed the raw data to an outsider and invited him to pull it apart.

That outsider was UNSW’s Associate Professor Rakesh Joshi, who learned graphene working alongside the bloke who won the Nobel Prize for discovering it. Joshi checked every run and dozens of measurement points across each sample, and confirmed the process does what Adisyn says it does.

The machine AI1 uses to lay the graphene down is an ALD system, which is the standard tool inside every leading-edge chip factory on earth. AI1’s invention is the chemistry that makes graphene form at low temperature inside that machine, and it’s patented.

Owning the pizza oven doesn’t mean you can make the pizza. TSMC, Samsung and Intel own the ovens. AI1 owns the recipe.

This is a swing at an industry heading toward US$1 trillion a year.

We first wrote AI1 up for readers in April at 6.8c, and it’s up more than 150% since then. The stated next milestone is a binding deal with one of the giants.

You can read our full breakdown here.

KTK Plants Its Flag in the US

There's a new flag flying in Los Angeles this week, and an Aussie small-cap put it there.

KTEK Aerosystems (ASX: KTK) signed a lease on a production and engineering facility in the city and took immediate possession of the warehouse and office space. The US build-out is already underway.

KTEK makes composite airframes and electromechanical assemblies for military and commercial drones, running an asset-light model that keeps the design and engineering in-house and farms out the manufacturing.

It’s one of our portfolio companies, and it already supplies into tier-one defence programs. The LA site is about turning that foothold into a much bigger book of US customers.

The US has lined up around $54 billion to scale up drone production, the biggest push of its kind the country has run. And a lot of American customers want a supplier with production on home soil before they'll hand over an order.

Plenty of US defence work also carries domestic sourcing rules a foreign-only supplier can’t meet. The LA facility clears both hurdles and gives KTEK a second production hub alongside its existing operations in Europe and Israel.

KTEK has been growing its revenue quickly since listing late last year. A base inside the world’s largest defence market, right as that market opens the chequebook on drones, is how a junior supplier turns a few tier-one relationships into many.

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Old Holes, New Scandium for Mount Ridley

Years ago, explorers drilled a few thousand holes into a stretch of ground 25km north of the port at Esperance, hunting nickel and copper. The samples went into storage, and the world moved on.

Nobody tested them for scandium, because back then scandium wasn’t worth the lab fee. It was a niche metal almost nobody chased.

Then China put it under export controls last year, and every aerospace and chip buyer in the West suddenly needed a new supplier for a metal the whole world produces about 25 tonnes of a year.

So Mount Ridley Mines (ASX: MRD), which now holds that ground as its Grass Patch Project, pulled 3,271 of the old samples out of storage and asked them a new question.

This week the answers came back. The current resource centres on a zone called Block 1, averaging 91.8ppm scandium oxide, and the reassays beat it comfortably, with near-surface hits of 9m at 152.89ppm and 20m at 116.39ppm.

The strongest grades sat about 13km southwest of the resource, on ground it doesn’t cover, and they improved the further out the samples came from. The system keeps going past the last hole.

Scandium sells for around US$3,350 a kilogram, and demand already runs at four times world supply.

These are aircore results, so they need proper drilling before anyone banks them. Phase 1 now rolls into the resource model, and Phase 2 is being scoped along that 13km corridor, with roughly 14,000 samples still sitting in storage.

Growing a resource off samples you already own, with no rig and no raise, is about as cheap as exploration gets. It’s one of a few reasons why MRD sits in our portfolio.

We broke down the announcement here.

Azzuro Hits Thick, High-Grade Copper in Mongolia

A 13-metre copper hit at over 2% is a strong result for any explorer, and this week it came from Azzuro Resources (ASX: AZ9), the portfolio company formerly known as Asian Battery Metals.

The assays landed from its Red Hill project in Mongolia.

Drillhole MU2601 returned 13.1m at 2.58% copper, with 0.96 g/t gold, 22.4 g/t silver and 0.76% zinc on top.

A hit like that at any size gets attention, and for a company carrying a sub-$20 million market cap it’s a result that can rerate a register.

The silver came in well above the earlier holes, adding metal credits to a system already throwing off four payable metals.

Red Hill is a volcanogenic massive sulphide system, which means the metal sits in dense pods of ore, and the pods come in clusters. Find one and the odds are good there's another nearby.

A second hole, MU2605, extended the massive sulphide another 124 metres along strike to the west-northwest, where the copper looks to be getting richer.

AZ9 has now traced the zone over roughly 272 metres of strike, and it’s open at depth and in both directions.

Assays are still pending on six diamond holes and three RC holes, due over the coming weeks, with a 3D gravity survey being modelled to sharpen the next targets.

The first two holes set the bar. Now the lab decides whether the rest clear it. Fingers crossed.

Fortuna Puts Rutile in the Bag

Exploration companies mostly deal in paper. Assay results, targets, estimates of what might be down there.

This week, Fortuna Metals (ASX: FUN), our rutile explorer in Malawi, produced something you can hold. A lab in Johannesburg took a 5.4 tonne bulk sample of dirt from FUN's Mkanda project and turned it into 66kg of rutile concentrate.

The grade came in at 1.22% and the ore processes cleanly. Once the final results land later this month, that concentrate becomes the product Fortuna puts in front of downstream buyers.

For anyone new to the story, rutile is the feedstock titanium makers prize most, and titanium goes into everything from jet engines to humanoid robots.

The reason this corner of Malawi first turned heads sits 20km to the north. Sovereign Metals’ Kasiya is the largest rutile deposit in the world, and FUN’s ground shares its geology.

The next step is isolating a premium spec above 95% TiO₂, the standard Kasiya set. Sovereign has already proven its rutile good enough for high-end aerospace work, and Fortuna wants to show it can do the same.

FUN’s drills kept moving all the while. Their 6,000m hand auger program is about 40% done and the 5,000m aircore program kicks off late June.

The maiden Inferred Resource Estimate, the company’s first formal count of what’s actually in the ground, is pencilled in for late June or early July.

All of this comes a week after WndrCo, an early backer of SpaceX and Figma, tipped $8.6 million into FUN for close to a fifth of the company, leaving around $15 million in the bank and keeping them cashed up for a long stretch.

We’ve held FUN since it was a 4c stock, and a backer of that calibre turning up is the strongest sign yet that we read it right.

WCN: Copper Grades We Haven’t Seen Before

White Cliff Minerals (ASX: WCN) is a $50 million small-cap that caught our eye this week on the back of one impressive drill hole.

The standout: 19.81m at 6.64% copper, and inside that sat 3.05m at 17.68% and 1.52m at 21.1% copper. That last one is basically a fifth pure copper down the hole.

We’ve looked at plenty of copper drilling over the years, and grades like that over a near 20-metre interval are not something we can say we’ve seen before.

It’s part of the Danvers prospect at WCN’s Rae copper project up in Nunavut, Canada.

Danvers already carries a historic (non-JORC) resource of 4.16Mt at 2.96% copper, and it sits on the Teshierpi Fault Zone, where the company says there’s around 12km of strike still to test and copper already logged over 4km of it.

The plan is an early direct-ship open pit, meaning ore gets dug and shipped straight to buyers without building a processing plant first. Met work showing copper recoveries above 95% on a simple flotation flowsheet makes that case easier.

A second diamond rig lands this week, with assays running through to July.

SpaceX and the Trillionaire

Elon Musk became the world’s first trillionaire on Friday, the day SpaceX went public.

The rocket maker floated on the Nasdaq under SPCX, the biggest sharemarket debut the world has ever seen. It pulled in US$75 billion, close to three times the US$25.6 billion Saudi Aramco raised in 2019, the record that had stood since.

Around 20% of the offer went to retail, far more than you’d normally see, with some punters celebrating an allocation of a single share. For once, the little guy could actually get a look in.

SpaceX is rockets and the Starlink satellite network, plus a slice of Musk’s AI outfit xAI. It’s flown around 650 launches and is the one that turned landing a rocket and reflying it into routine.

The stock was priced at US$135, opened at US$150, ran as high as US$176 intraday, then closed at US$160.95, up roughly 19%.

That handed SpaceX a market cap of US$2.1 trillion, bigger than Musk’s own Tesla.

Convert that to Aussie dollars and it comes to about AUD$3 trillion for one company. Every business listed on the ASX put together is worth about the same.

Which is how Musk became the world’s first trillionaire. Between his SpaceX and Tesla holdings, he’s worth around US$1.1 trillion on paper.

Strip it back and SpaceX is really three businesses. Starlink, the satellite network, turns a real profit and grows fast, with the rockets doing alright behind it. xAI, his AI arm, is still burning cash to get going.

Musk built the float around xAI anyway. It’s his shot at OpenAI and Anthropic, with data centres orbiting the planet and a potential market of nearly US$27 trillion.

SpaceX did around US$18 billion in revenue last year and lost almost US$5 billion doing it. But it takes a brave man to bet against Elon, and reusable rockets looked every bit as unlikely right up until they worked.

The talk now is whether he folds SpaceX and Tesla together. Dan Ives at Wedbush thinks they could combine inside a year, and the two are already building a chip plant together in Texas.

Musk has said any tie-up would be a brute to pull off, with both boards needing to sign it off.

The Week Ahead

WCN’s second diamond rig lands in the coming days, with assays running to July.

AZ9 has nine more holes at the lab, and MRD is scoping Phase 2 along that 13km scandium corridor.

FUN puts a number on Mkanda for the first time in late June or early July, and AI1’s next move is a binding deal with one of the chip giants.

That can all keep till Monday, though. This afternoon the Socceroos walk out against Turkey, twenty years on from the golden generation we saw in Germany in 2006.

Aloisiiii, the shirt whipped over the head, Guus working his magic, and half the country up past midnight for Cahill.

Nobody’s giving this lot much of a chance, but nobody gave that mob one either. Get around them.

Till next week.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (”Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 500,000 KTK shares, 900,000 AI1 performance rights, 1,544,000 FUN shares, 2,083,333 MRD performance rights, 1,150,000 AZ9 shares at the time of publishing this article. Equities Club has been engaged by KTK, AI1, FUN, AZ9 and MRDat the time of writing.

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Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

Mount Ridley Mines (ASX: MRD) just grew its scandium hand out of a storage shed.

MRD’s Grass Patch Project sits about 25km north of the deepwater port at Esperance in WA, and already holds a sizeable scandium resource.

The company dug a batch of old drill samples out of storage and sent them back to the lab to be re-assayed for scandium. Those holes were drilled years ago, back when the ground was being chased for nickel and copper. The scandium in them was never measured at the time.

The numbers came back well above what is already defined. Block 1, the company's central scandium zone, holds 155.2Mt at 91.8ppm Sc₂O₃.

The reassay beat that comfortably, with hits like 9m at 152.89ppm and 20m at 116.39ppm, both near surface.

The hits landed about 13km southwest of the current resource, on ground the resource doesn't cover yet.

For those new to scandium, it goes into aluminium alloys for aircraft, defence platforms, fuel cells and 3D-printed parts, and for years it sat as a niche metal almost nobody chased.

That changed in April 2025, when China put it under export licensing and Western buyers in aerospace and semiconductors had to start finding supply somewhere else.

MRD is a portfolio company of ours and sits at 2.5c with a market cap around $35 million, a small company sitting on a large mineralised system it’s only now starting to map properly.

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What Came Back

Phase 1 of the reassay covered 3,271 old air core pulps from across the Grass Patch Complex.

The scandium was in the samples the whole time. Nobody had thought to look.

When they finally did, the best holes came back well above the Block 1 resource average, and the strongest grades turned up right at the edge of the old drilling, where the resource runs out.

Some of the standout hits:

• 9m at 152.89ppm Sc₂O₃ from 9m

• 13m at 137.61ppm Sc₂O₃ from 6m

• 9m at 132.98ppm Sc₂O₃ from 9m

• 10m at 127.80ppm Sc₂O₃ from 9m

• 20m at 116.39ppm Sc₂O₃ from 15m

Grades are meant to fade as you walk away from a defined resource. You’ve drilled the good bit, the edges thin out, that’s how it usually goes.

At Grass Patch the opposite happened.

The numbers climbed the further out the holes sat, and the best of them landed right at the boundary of where anyone had bothered to drill.

That tells you the resource on the books could be the small end of what’s in the ground, and the company hasn’t found the edge of the system yet.

So for the cost of lab work, MRD has a fistful of near-surface scandium hits and a 13km corridor of untested ground pointing away from the resource. That corridor is where the drill goes next.

The Scandium Story

Scandium is one of those metals almost nobody talks about until they can’t get it.

The entire world produces around only 25 tonnes a year (demand’s already more than four times that). Barely any of it comes from outside China and Russia, and most of what does get made is a by-product of mining something else, so nobody can just turn up supply when it’s needed.

And since that clampdown, the buyers who lean on it, aerospace and the chip makers, can’t count on the supply that used to run through Beijing.

Scandium sits around US$3,350 a kilogram, a different universe to the metals most ASX juniors dig for.

Demand is tipped to grow about 14.5% a year out to 2031, off the back of those same end uses, and there’s next to nothing new being built to supply it.

Mount Ridley says it holds one of the largest scandium resources going, 25km from a deepwater port in WA. That’s a lot of a scarce metal, in a country the West actually wants to buy from, right when that’s the one thing everyone’s chasing.

The Cheapest, Smartest Path MRD Could Ask For

Mount Ridley skipped most of the bill.

For most explorers this size, the cash goes out the door faster than the results come back, and plenty of good ground never gets tested because the money runs dry first.

Here the drilling was already done years ago, and someone else paid for it, the nickel and copper explorers who worked this ground long before MRD arrived.

The holes are in, the samples are on the shelf, and the only real cost left is the lab invoice.

There are roughly 14,000 more pulps still waiting, on top of the 3,271 already run. Each one is a cheap shot at a bigger resource, off holes already drilled and paid for.

And the results come back in weeks, not the months a new drill program usually eats.

For a junior trying to make a dollar stretch, you couldn’t script it much better.

The first batch goes straight into the resource model, with a real shot at lifting parts of the existing resource from Inferred to Indicated.

Phase 2 is being scoped now, pointed squarely at that 13km corridor where the best grades turned up.

The Way Forward

MRD calls itself an explorer, but it’s trying to become a developer, and this nudges it further down that road.

The honest read is that there is still a fair way to go. These are aircore hits inside an Inferred resource, and they need real drilling before anyone banks them. The strike is open and the 13km corridor hasn’t seen a rig yet.

A resource growing off 14,000 pulps already in storage, with no rig and no raise, is about as efficient as a junior gets.

The market still prices MRD like a plain-vanilla explorer, a shallow scandium system 25km from a port, in the one country every Western buyer wants to source from as they back out of China.

The next assays aren’t far off. Keep pulling numbers like these out of storage, with the drill still to come, and a $35 million valuation likely won’t hold.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (”Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club has 2,083,333 performance rights in MRD. Equities Club has been engaged by MRD at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

Adisyn (ASX: AI1) just cracked the code.

It deposited the graphene below 300°C, and it did it run after run. No previous graphene process has worked below the industry's thermal limit, anywhere.

Copper is the wiring buried inside every advanced AI chip on the planet, and it’s hit its physical limits. TSMC, the biggest chipmaker on earth, has already named graphene as the way past it, and Adisyn is the first to deposit graphene at a temperature a chip can survive.

This is a trillion-dollar-a-year industry, and an ASX small-cap just delivered the result that makes Samsung, TSMC and Intel sit up and pay attention.

Adisyn is one of our portfolio holdings. We first wrote it up for readers in April at 6.8c, and it's up more than 150% since then, with the biggest catalysts still in front of it.

Today’s result clears the way for the big one, a commercial deal with one of the global chipmakers, and that’s what management is chasing inside the next 12 months.

AI1 made the breakthrough, then did the thing most small-caps avoid. It handed the raw data to someone independent and let them pull it apart.

That someone trained alongside the man who won the Nobel Prize for discovering graphene.

His name is Associate Professor Rakesh Joshi, who runs the Graphene Research Group at UNSW. He went through Adisyn’s data, across repeat runs and multiple points on the sample, and confirmed it stacks up.

The Man Who Checked the Work

In 2010, two scientists at the University of Manchester won the Nobel Prize in Physics for a material they had peeled off a block of graphite using ordinary sticky tape.

The material was graphene. A single sheet of carbon atoms, stronger than steel and a better conductor than copper, and their work turned it from theory into something you could hold.

One of those two scientists was Sir Andre Geim. Early in his career, Rakesh Joshi worked under Geim at Manchester and co-authored research with him.

These days Joshi is an associate professor at UNSW, where he leads the university’s Graphene Research Group and has published more than 130 papers in the field. Few people on earth are better placed to look at a set of graphene results and tell you whether they hold up.

So Adisyn handed him everything. The same deposition process run three times on three separate days, plus dozens of measurements taken at points right across each sample.

Each of those samples is a small square of copper, about a centimetre a side, with the graphene grown on it. By grown we mean carbon is laid down inside a chamber and the atoms settle into a single layer, one atom thick, across the copper.

One set of tests shows the result repeats, the other shows it’s even across the whole surface.

Joshi, who doesn’t work for Adisyn and has no stake in the outcome, went through the lot and confirmed the graphene is real, and that the process does what Adisyn says it does.

Plenty of companies say their science works. Not many are confident enough in the results to hand an outsider of that calibre the raw data and invite him to prove it doesn’t.

Why the Temperature is the Whole Game

Every advanced chip today runs on copper. Billions of transistors, all linked by copper wiring far too fine to see, moving electricity around the chip.

Copper has worked beautifully for decades. The problem is what's happening now the wires have shrunk this far.

The newest chips are shrinking below two nanometres, and at that scale copper starts to choke. Resistance climbs and the wiring runs hot, so power that should be doing useful work leaks away as heat. Across a data centre full of AI chips, that waste turns into a power bill big enough to run a small city.

The industry has known the fix for years. Graphene moves electricity more efficiently than copper, and it keeps doing it at sizes where copper overheats and fails.

Graphene was always going to work. The hard part was making it.

Growing it the usual way takes heat of around 1,000°C. A chip is a delicate stack of materials, and anything past about 450°C starts to wreck the structures already built into it. So the one material that could save the chip had to be grown at a temperature that would destroy it.

That’s the wall. Every chipmaker on earth has been staring at it for a decade.

Adisyn just grew graphene below 300°C. Comfortably under the ceiling.

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Anyone Can Get Lucky Once

The customers Adisyn is chasing are the giant chip factories, known in the industry as fabs.

TSMC, Samsung and Intel run them, and none of them will build a billion-dollar production line around a coating that worked one Tuesday and never again. So this result was about proving the first one would repeat.

Adisyn ran the same process three times, on three separate days. Same recipe, same setup, and each run produced the same graphene layer.

Then they checked the layer was good across the whole square, not just in one spot. When you grow a coating this thin, the danger is it comes out patchy, solid in one part and thin or missing in another.

A patchy layer is no use inside a chip. So they sampled the graphene at three different points across the surface, and it was the same at all of them.

Repeatable run to run, and the same right across the sample. A university lab can manage a one-off. A fab’s production line needs both, every single time.

The result proved a third thing (and this is the one chipmakers get excited about).

Adisyn's process works across a wide band of temperatures, which the industry calls a process window.

Say a process only forms its coating at one set temperature, 350°C and nothing else. Every other step on the production line then has to be built around that single number, which makes it a headache to fit in anywhere.

Adisyn's process runs from below 450°C all the way down under 300°C. The low end keeps it safe on the delicate structures a hotter process would wreck, and the width gives a fab the room to use it at several points along the line and set the temperature where the rest of the process needs it.

A window that wide also opens it up to jobs beyond the interconnect wiring. The more places a fab can slot it in, the more the industry wants it.

The machine Adisyn used, called an ALD system, is the standard tool already sitting in every leading-edge fab on earth. So if TSMC already owns the machine, what are they paying Adisyn for?

Think of the machine as just the oven. Adisyn’s invention is the recipe, the chemistry and the precise process that makes graphene actually form at low temperature inside that oven.

Owning a pizza oven doesn’t mean you can make the pizza. Adisyn owns the recipe to one of the most promising breakthroughs in microchips in a decade, and it’s patented.

That’s the part a fab can’t get anywhere else, and will pay a whole lot for.

Where AI1 Sits Today

A quick catch-up for anyone new to the story.

We got on the register in early April. Inside a week it ran to 20c, topped the ASX gainers board and added around $130 million in market value.

It hasn’t slowed down since.

The graphene process AI1 has cracked points at two very different markets.

The first is the one we’ve been walking through. Inside a chip, graphene grows as the wiring that carries the signal, the job copper can no longer do as chips keep shrinking.

The second is stealth. A radar finds an aircraft by firing out a signal and waiting for the echo to bounce back. Coat that aircraft in Adisyn’s graphene and the echo gets swallowed instead of returned, so a full-sized drone reads on the screen as something closer to a bird.

The same material that fixes the chip also helps a drone fly in unseen.

The news flow since April has been relentless. Adisyn locked in an exclusive worldwide licence on the stealth tech out of Tel Aviv University, then raised $14 million with Israel’s biggest investment house and Regal cornerstoning the book. Then the former commander of Israel’s Iron Dome came on to advise the drone arm, and the US granted the patent that sits over the whole thing.

This week, the chip side took the next big step forward.

What This Unlocks

Until now, Adisyn has been a lab story. A good one, but a lab story. With the result independently verified, the company can stop talking about what the process might do and start showing it to the people who’d buy it.

That means the Tier 1 chipmakers, the TSMCs and Samsungs of the world, and conversations about running the process inside their own fabs.

There’s a scaling job to do first. Everything so far has been grown on a square of copper a centimetre across. A real chip is built on a wafer, a silicon disc up to 300 millimetres wide, and Adisyn has to take the process up to that size before a fab can run it for real.

Think of it as proving the recipe works in the test kitchen, then proving it works in a restaurant turning out a thousand plates a night.

Then comes the part every small-cap is ultimately judged on. The science can be brilliant, but a company only gets rewarded once that science starts earning.

Adisyn’s path to that is licensing.

It owns the patented recipe, the fabs own the factories, and the cleanest model is to let them run the process and collect a royalty on every wafer that comes off the line.

A process this central is also an asset a major could simply decide to buy outright.

When the industry last switched interconnect material, from aluminium to copper, the chipmakers went out and bought the new chemistry from specialists.

Graphene is also one of the best heat conductors known. AI chips are built by stacking smaller chips tightly together, and packed in like that they run hot. Cooling those stacks could be where the graphene side brings in its first revenue.

The global semiconductor market is tracking towards US$1 trillion next year, and Adisyn’s process plugs straight into the interconnect segment, the wiring sitting inside every advanced chip. That segment is worth around US$31 billion today and headed for US$45 billion by 2035.

Now weigh it against the company carrying it. Adisyn’s whole market value wouldn’t cover the fit-out of one corner of a multi-billion dollar TSMC fab, and it owns the patented recipe the giants are going to need.

What We’re Watching From Here

The next domino is a million-dollar cheque.

Adisyn’s stated target is a binding deal with one of the global chipmakers, worth north of a million dollars to AI1, and the first of what could be many. For a company this size, that first name on a contract would land like a bomb.

Then watch who comes to the table. Adisyn is about to walk into TSMC, Samsung and the rest carrying results nobody can hand-wave away and a US patent in its back pocket, and the names that lean in, plus how fast they do it, will tell the story louder than any ASX release.

The giants will take their time. They test a new process half to death before they let it anywhere near a production line, so the conversations Adisyn is about to start will run on their clock. Worth remembering for anyone expecting sales by tomorrow.

While they get comfortable, we’re sitting on the one company that’s already cracked the thing every last one of them needs.

Our View

Step back from the nanometres and the interconnects for a second.

The most advanced industry on earth has been stuck on the same problem for a decade, and this week a small-cap on the ASX put a verified answer on the table.

Signed off, no less, by a man who learned graphene standing next to the bloke who won the Nobel for it.

Something this big usually sits locked inside a university lab, or buried in a research budget at TSMC. This one trades on the ASX.

The hard science is progressing quickly, and what’s coming is the selling, to buyers who are already telling the world that graphene is the future.

Every target the company has set itself, it’s gone and hit, and now it’s handed the proof to someone with no reason to flatter it.

A Nobel Prize was handed out for discovering graphene.

The fortune goes to whoever works out how to deploy it at commercial scale.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (“Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 900,000 performance rights at the time of publishing this article. Equities Club has been engaged by AI1 at the time of writing.

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The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

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This week Elon Musk and SpaceX put their hand out for one of the biggest cheques public investors have ever been asked to write, a raise that would value the company at roughly US$1.8 trillion.

ASX investors can get a slice too.

To put that in context, it's about what the entire ASX top 100 is worth combined

SpaceX started life as a rockets company, but that’s almost the boring part now. These days it’s pitching itself as a satellite internet giant and an AI infrastructure player that could end up one of the most important tech platforms of the next decade.

Whether it’s actually worth US$1.8 trillion is something the market will sort out in a couple of weeks when it lists.

Back in small-cap land, news was dropping everywhere. Silicon Valley money turned up in Malawi, AI1 went into a halt chasing a world first, EVG quietly added to its foundations, and DXN reminded everyone that AI stories work a lot better with a signed contract attached.

We also caught one of the strangest announcements of the year, a brutal biotech wipe-out, and a drone supplier having the week of its life off the back of the market's hottest theme.

Let’s get into it.

• Silicon Valley money arrives in Malawi as WndrCo backs Fortuna Metals

• Adisyn shareholders brace for a Milestone 2 verdict

• Evion adds Arthur Sinodinos and delivers positive EBITDA

• KTK keeps climbing as drone demand gathers momentum

• DXN proves AI still works when revenue is attached

• Opthea's 97.5% collapse and the cold reality of biotech

• SRJ's awkward SpaceX moment and the price query that followed

  ---

Silicon Valley’s Smart Money Lands in Malawi

One of the most connected technology investors in Silicon Valley has just written an $8.6 million cheque to Fortuna Metals (ASX: FUN), taking a 19.9% stake and becoming its cornerstone shareholder.

The investor is WndrCo, the US fund founded by Jeffrey Katzenberg and Sujay Jaswa, with more than US$3 billion under management and a track record of backing some of the biggest tech winners of the past decade.

Names in the portfolio include SpaceX, Anduril, Waymo, Databricks, Figma, Airtable and 1Password.

This is smart money. It spends its time working out where technology is heading before the rest of the market catches on.

WndrCo is arriving just as humanoid robotics moves from theory to production. Tesla wants to build millions of Optimus robots, defence contractors are deploying autonomous systems, and every one of those machines needs lightweight, high-strength materials.

Titanium sits near the top of that list, and rutile is one of its key feedstocks (the raw material you process to get the metal).

The money itself is meaningful, but the network may prove even more valuable.

With roughly $15 million in the bank after the raise and a cornerstone backer who understands where titanium demand is heading, Fortuna goes into the second half of the year with options. The stock finished the week at 12 cents. You can find our full write-up here.

Adisyn Waits for a Defining Moment

Adisyn (ASX: AI1) is one of ours. We backed it at 6.8 cents and it's now 17.5 cents, so we're watching this one as closely as anybody.

The company went into a trading halt this week pending independent validation of Milestone 2 in its graphene semiconductor program.

In plain terms, it needs to show it can lay down graphene reliably and repeatably below 300°C across multiple independent runs, with even coverage right across the test surface.

Management reckons that if it lands, nobody anywhere in the world has pulled it off before.

The whole case rests on graphene eventually replacing or improving the tiny connections that move data around a chip, the interconnects, which are one of the bottlenecks the industry keeps running into.

Holders have already had a taste of what a result does here. When Milestone 1 came through in January, the stock ran from around 6.8 cents to almost 30 before settling back under 20.

Milestone 2 carries even more weight.

There’s no guarantee the result lands the way shareholders are hoping. If it does, and the company keeps moving towards commercial engagement with semiconductor groups, Milestone 1 showed how the market tends to respond.

Bring on Tuesday.

EVG Keeps Adding Bricks to the Wall

The share price didn't show it this week, but Evion Group (ASX: EVG) kept putting runs on the board.

First came the appointment of former Australian Ambassador to the United States Arthur Sinodinos AO as a strategic adviser. For a $29 million company, landing someone whose network runs that deep through Canberra, Washington and critical minerals policy is a rare get.

Later in the week EVG’s Panthera Graphite Technologies operation delivered audited EBITDA of US$530,000 in its first full year of commercial production. The eye-catching part was that it did it while running at only 20-25% nameplate capacity (the maximum the plant is built to produce), while still paying down debt from operating cash flow.

Management is now mapping a path towards US$3.4 million EBITDA at Stage 1 capacity and US$5.8 million at Stage 2.

So EVG has a critical minerals business that actually earns money, a Nevada fluorspar project sitting in the middle of America's supply-chain scramble, and now an adviser plugged into the circles writing that policy.

The fluorspar backdrop shifted in Evion’s favour this week, and it came out of China.

China Kings Resources, the country's biggest fluorspar producer, has suspended several mines and launched a self-inspection on environmental and safety grounds.

China supplies most of the world's fluorspar, so when its largest producer pulls tonnes offline, everyone downstream feels the pinch.

Every shutdown like that makes a non-Chinese source worth a bit more, and a Nevada project feeding America's critical minerals push sits on the right side of it.

The market marked the stock down this week, but the underlying story keeps getting stronger.

KTK Keeps Finding Buyers

Plenty of stocks spike for a day and disappear. KTEK Group (ASX: KTK) is doing the opposite.

Another one of ours, backed from the 20-cent IPO, it climbed another 50% this week, from 32 cents to 48 on better than $5 million of turnover, as the market kept chewing over last week's news that deliveries had resumed after some supply-chain strife. On paper that's a fairly standard update. The buying says investors see something bigger.

What they're looking at is where KTK sits in a defence sector changing by the month.

The company makes composite airframes and the electromechanical guts of drones for Tier-1 manufacturers, which plants it inside one of the fastest-growing corners of defence going around.

The backdrop keeps helping, with reports only last week that the Trump administration is weighing funding to prop up domestic drone makers and shore up America's supply chain.

Management has talked about taking its ‘cordless factory’ model into the US, setting up small production sites right next to customers rather than building one giant plant. That idea makes a lot more sense if Washington starts tipping real money into home-grown drones.

For now the market's treating drones less like aerospace and more like ammunition, and that tailwind is still blowing hard.

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DXN Finally Gives the Market Something Real

The most talked-about small-cap of the week was DXN (ASX: DXN), and no wonder, it finished up 775%.

The stock ripped higher after signing a binding $8.8 million contract with a US-listed neo-cloud operator (a newer breed of cloud provider built specifically for AI workloads) to design and build an AI modular data centre.

This one moved because of a signed contract with revenue and a delivery attached.

It stood out in a week where a lot of the market’s biggest movers were still running on reinstatements, capital structure changes, speculative bets or simple repricing.

The contract is a pilot deployment, but management believes a clean delivery could open the door to follow-on work north of US$200 million.

It also lands square in the right theme, with AI infrastructure starting to bleed into the defence-grade and sovereign computing that governments want kept onshore.

The one blemish came late Friday, when two directors trimmed part of their holdings, worth roughly $78,000 and $130,000.

After a move that size, few would begrudge them taking a little off the table.

OPT Shows How Brutal Biotech Can Be

Few charts this year have looked uglier than Opthea's (ASX: OPT).

The company came back to trading this week after a long suspension and immediately lost around 97.5% of its value, dropping from roughly 60 cents to just 1.5 cents.

The collapse had been building for months. A late-stage drug trial failed (Phase 3, the final round before a treatment can be approved), in this case for a common eye disease that causes vision loss in older people. After that, the company had to rethink what it would become next.

The old Opthea is gone.

What's left is a much smaller company built around its remaining drug candidate and a new focus on a rare lung disease called LAM, with $31.2 million in the bank and an 18-month plan to develop it. That's a long way from the business that went into suspension.

Biotech is one of the highest risk/reward corners of the market. Years of work and hundreds of millions of dollars can vanish on a single failed trial.

Sometimes the science works. Sometimes it doesn’t.

Opthea is what the second one looks like.

SRJ Gets Itself Into an Awkward Spot

Which brings us back to where we started, only at the other end of the size scale.

SRJ Technologies (ASX: SRJ) was probably the strangest story of the week.

The company emailed shareholders to reveal that SpaceX had adopted its BoltEx technology, a maintenance fix designed to keep critical infrastructure running while bolts are swapped out.

For a small-cap, that’s validation you dream about. SpaceX is one of the most demanding engineering shops on the planet and doesn’t hand out endorsements lightly.

Investors piled in. Shares jumped more than 50% at one stage before the ASX stepped in with a price query.

Then it got awkward. SRJ told the market operator the SpaceX adoption wasn’t material enough to warrant an announcement, and that the underlying order had already been referenced in an earlier update.

Flagging something straight to shareholders and then calling it immaterial when the regulator taps you on the shoulder is not a great look.

The stock still finished the week up 23%, but questions linger.

Having SpaceX deploy your tech is still real validation. The challenge for SRJ now is turning it into revenue and orders investors can actually measure.

The Week Ahead

Tuesday morning is the one to watch. Adisyn comes back from its halt to tell the market whether it can deposit graphene below 300°C, the core of Milestone 2.

We'll also be keeping half an eye on gold after Friday's drop to see whether it steadies, and on copper to see whether it holds its ground.

US markets fell on Friday night, so Monday opens with the question of whether we follow them down or shrug it off, though with Victoria on a public holiday we'd expect a fairly muted session either way.

As we roll into June, the bigger question is whether the market holds up over the coming weeks. Whichever way it breaks, we're expecting a solid run of news out of our portfolio companies.

Till next week.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (”Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 500,000 KTK shares, 900,000 AI1 performance rights, 4,500,000 EVG shares, 1,554,000 FUN shares at the time of publishing this article. Equities Club has been engaged by KTK, AI1, FUN, and EVG at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

The company is one we’ve backed: Fortuna Metals (ASX: FUN). The fund is WndrCo, an early backer of SpaceX and Figma, with more than US$3 billion under management. It now owns close to a fifth of FUN.

WndrCo was built by Jeffrey Katzenberg, who ran Walt Disney’s studio before he walked out and built DreamWorks into a Hollywood powerhouse. His partner, Sujay Jaswa, helped scale Dropbox from a few million in revenue to half a billion.

These are the people who get to the front of the queue on what’s coming next. Right now that’s Elon Musk winding down Tesla car lines to build Optimus instead, the humanoid robot he wants a million of a year.

Build robots in those numbers and you need titanium, light and strong under load. The cleanest source of it is rutile, the rock sitting under Fortuna’s ground in Malawi.

That rutile is why WndrCo wrote the cheque.

A cornerstone stake like this takes months in the data room before a cent changes hands. WndrCo came out the other side and put millions into a tiny explorer in a corner of Africa.

That leaves Fortuna with close to $15 million in the bank, enough to run for years without going back to shareholders.

The bigger prize is the network that comes with the money. WndrCo knows the major players who actually buy titanium, the buyers a junior in Malawi could chase for years and never get in front of.

We’ve held Fortuna since it was a 4c stock, and a backer like WndrCo turning up is the strongest sign yet we read it right. Companies this size rarely pull a partner of that calibre. FUN just did.

Who WndrCo Is, and What They’ve Backed

Sujay Jaswa has spent 20 years spotting which companies would win before the rest of the market caught on.

He did it at Dropbox, joining as one of its first hires and watching 15 million users turn into 300 million.

He did it cutting venture cheques at New Enterprise Associates, backing Workday and Cloudflare while they were still unproven names. He does it now at WndrCo, the firm he co-founded in 2016. He still finds time to lecture at Stanford between deals.

Katzenberg sits on the other side of the table, and the pair makes an odd one. One spent decades reading what the public would fall for next from the top of Hollywood. The other spent his career reading which technology would win from the inside of it.

Put a film mogul and a software financier together and you get a firm that backs both instinct and data.

That instinct runs right through WndrCo’s book. Most of the names mean little to an Australian investor, but in US tech they are the ones everyone knows.

They got into Figma early, the design software company that listed in New York last year and tripled on its opening day.

They hold a slice of Databricks, worth around US$134 billion while it is still private (one of a tiny club of companies to reach that kind of money without ever going public).

They own 1Password and Airtable, and they have built cybersecurity companies up from nothing.

Those rockets, drones and self-driving cars from the top of this piece have names. SpaceX. Anduril, the defence-tech outfit building autonomous weapons for the US military. Waymo, Google’s self-driving car arm.

Three of the most closely watched private companies on earth, and every one of them will be reaching for the same metals as it grows.

The way they back a company tells you as much as the names. WndrCo gets in early and goes deep. They lead the round and write the first institutional cheque.

They call themselves “the founders behind the founders”, and the model runs on seeing something before the market does, then helping drag it into the daylight.

So when a fund like that walks past the next AI darling and writes its cheque to a rutile explorer in Malawi, it’s worth asking what they saw. The rest of this is our best read on it.

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Why They're Backing Fortuna

What they saw is titanium, and a squeeze coming for it.

Rutile is the cleanest natural source of titanium there is. Start with rutile and you strip less out on the way to the finished metal, which is why buyers pay up for it. Fortuna’s ground in Malawi is shaping up as one of the best rutile stories on the ASX.

Forecasters have the titanium metal market growing from about US$30 billion this year to US$57 billion by 2035, and the pull is coming from every direction at once.

In aviation, every kilo of titanium that replaces something heavier in a jet engine or airframe saves fuel, so airlines never stop wanting more of it.

And since Russia rolled into Ukraine the West has been rearming in a hurry, with the US and Germany pushing defence budgets higher year on year, and a modern fighter jet is something like 40% titanium by weight.

Humanoids run on the very same metal. Tesla alone is talking about a million Optimus units a year to start, and Musk has floated far higher numbers after that, every one of them needing a frame that stays light under load.

While all that demand stacks up, supply is going the other way. The old rutile deposits are running down. China sits on roughly 70% of the world’s titanium sponge production, the first solid form the metal takes. And America imports 100% of the titanium metal feedstock it runs on, every gram of it from somewhere else.

Demand climbing while the supply tightens, with the biggest economy on earth caught short.

A Silicon Valley fund backing a friendly source early knows where this is heading.

The Doors They Open

The money is the smaller half of this deal. The bigger half is the doors it opens.

The way the deal is built shows WndrCo's hand. The $8.6 million buys the equity, but their real upside sits in a parcel of options that only pay out if they walk Fortuna in front of a US commercial partner by 2029, whether that is a metals trader, a defence or aerospace group, a processor that turns rutile into titanium sponge, or an end user like a humanoid robot maker.

The firm gets paid to open doors, so it keeps knocking long after the cash has cleared.

These are doors a Malawian junior could spend a decade knocking on and never get through.

WndrCo already sits behind the companies turning metal into rockets and autonomous machines, the same outfits that will be hunting for titanium feed as they scale.

They led the funding round for Alembic, an AI business whose product NVIDIA uses in its own marketing and whose work NVIDIA boss Jensen Huang has publicly put his name behind.

Jaswa chairs cybersecurity firms and has sat on American boards for years. Katzenberg has spent four decades building a contact book at the very top of US business.

When people like that ask for a meeting, they get one.

They sit in the rooms where the buyers sit, the companies that will need the titanium all that demand is chasing.

A junior explorer in Malawi can pull brilliant rutile out of the ground and still never get near the people who turn it into jet parts and robot frames.

WndrCo can make the introduction in an afternoon, and the way the options are written, it is squarely in its own interest to make it.

What This Means for Fortuna

A week ago Fortuna was a $37 million explorer with a good story, a great project and the usual junior's headache of how to pay for the next phases.

It now has a US cornerstone holder, close to $15 million in the bank, and a partner whose own payday rides on dragging Fortuna into a room full of American buyers.

Many juniors this size have to live raise to raise, diluting holders just to keep the drills turning. FUN can fund itself through to a decision on whether to build a mine without going back to the market, cap in hand.

The catalysts are already lining up.

Deeper aircore drilling is about to start. A maiden resource estimate for Mkanda is due late this month, the first hard number on how much rutile is in the ground.

And in Johannesburg, the metallurgical test work on a six-tonne bulk sample is wrapping up, with the concentrate it produces headed for the desks of potential buyers.

FUN now storms into the back half of the year with money, a resource, a product in hand and a backer working the phones on its behalf.

A fund that has backed some of the biggest names in technology ran its diligence and decided Fortuna was worth millions and a multi-year partnership.

It is now paid to make Fortuna bigger, and it has the contacts to do it.

Tailwinds like this one do not come along often for a company this size.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consult your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (“Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 1,554,000 FUN shares at the time of publishing this article. Equities Club has been engaged by FUN at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

He looks like he belongs there, because for three years he did.

From 2020 to 2023 he was Australia’s ambassador to Washington, the man Canberra sent to negotiate with the Americans. Before that he ran John Howard’s office and sat in Cabinet, and for years people had him pencilled in as a future Treasurer.

This week he signed on as strategic advisor to Evion Group (ASX: EVG), a critical minerals play trading at 4.9 cents with ground in Nevada.

Men with that record don’t usually surface around ASX small-caps. For a company Evion’s size, it’s a name with a reach most juniors never get near.

Sinodinos advises a private capital fund out of US which owns the very tungsten project Donald Trump Jr and Eric Trump just backed. He moves through Washington’s critical minerals world at a level a junior explorer almost never reaches, and Evion has just brought him into its corner.

A good deposit still counts for everything in this game, but what’s changed is that critical minerals now sit in the middle of a geopolitical fight that keeps getting messier.

Washington, Canberra and their allies are tipping billions into supply chains tied to defence, semiconductors and energy security, all of it aimed at cutting their reliance on China.

The governments running those programs decide who gets the funding and the contracts.

Getting a small company in front of them is the hard part, and it’s the part Sinodinos has spent 30 years developing.

From Howard's Office to Trump's Washington

Before Washington, Sinodinos had already spent two decades close to power.

He ran John Howard’s office, then moved into the Senate and into Cabinet, picking up Assistant Treasurer, Cabinet Secretary, and Minister for Industry, Innovation and Science.

That last job put him in charge of the government’s industry and resources policy, the same brief now driving the critical minerals push.

Then came Washington.

His three years there lined up with the moment the West stopped taking its supply chains for granted. AUKUS was signed on his watch and defence ties tightened.

Around the same time, critical minerals went from a quiet corner of the mining world to a national security problem, largely because so much of the supply ran through China.

The relationships he built over those years reach into the US government and the investment houses now circling the minerals trade.A prvate US fund is one of them.

The Trump Sons' Tungsten Play

The appointment gets more interesting once you look at where else Sinodinos is spending his time.

He’s also a strategic advisor to a private US fund which backs critical minerals projects tied to American supply chain and resource security.

The fund has been busy across North America, building a book of investments aimed at domestic manufacturing and strategic supply.

Its highest-profile play is Kaz Resources, a Kazakhstan tungsten venture carrying the largest known undeveloped tungsten resource on the planet, with up to US$1.6 billion in US government financing lined up behind it.

Tungsten goes into drilling tools, armour-piercing rounds and kinetic missiles, and China controls about 80% of the world's supply. After Beijing tightened its export rules early last year, the price ran from roughly US$350 a tonne to around US$3,100. The West wants its own.

The project made headlines when Donald Trump Jr and Eric Trump turned up as investors, through Nasdaq-listed company Skyline Builders, which merged with the fund’s tungsten unit.

The combined entity, Kaz Resources, is set to list on the Nasdaq under the ticker KAZR.

The US fund’s man on the government relations and partnerships behind deals like Kaz, across North America and Central Asia, is Sinodinos.

That’s the same skill set EVG now has.

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No Better Place Than Nevada

The appointment lands right after EVG’s acquisition of the CARP Fluorspar Project in Nevada, which drops the company into what plenty of people still rate as the best mining jurisdiction going.

Nevada has the infrastructure and the permitting to get mines built, and a long history of building them.

Getting a mine built is the catch in the whole critical minerals push. Governments want domestic supply, but supply has to start with projects that can get permitted and developed somewhere stable. Nevada fits.

CARP gives EVG exposure to fluorspar, which gets a fraction of the airtime lithium and copper get, while quietly doing a lot of heavy industrial lifting.

It goes into hydrofluoric acid, semiconductors, uranium processing, aerospace and defence supply chains, and the US and several allies list it as a critical mineral.

China sits at the centre of fluorspar supply, the same way it does with graphite, and the West is scrambling to build its own sources. That’s the gap a Nevada project is aimed squarely at.

Three Legs, Three Continents

Nevada grabbed the headlines, but fluorspar is the newcomer in EVG's story. The company started life chasing graphite, and that side is an important piece.

Its flagship there is the Maniry Graphite Project in Madagascar, which the European Union has tagged as a strategic project under its Critical Raw Materials Act.

In plain terms, Brussels has formally backed it as part of Europe's plan to build a battery supply chain that doesn't run through China.

Then there’s India, where EVG holds a 50% stake in Panthera Graphite Technologies, a processing plant already selling expandable graphite into the US and Europe.

So EVG has graphite coming out of the ground in Madagascar, a plant turning it into product in India, and fluorspar in Nevada, with no Chinese partners anywhere in the chain.

Last week the US, Japan, Australia and India launched the Quad Critical Minerals Initiative Framework, a plan to mobilise up to US$20 billion across mining, processing and recycling.

The point of it is getting critical minerals supply out of Chinese hands.

Line EVG up against that framework and it covers the US through fluorspar, India through graphite processing, and Australia through the listing itself.

What the Appointment Actually Delivers

For most small-caps it comes down to the rock in the ground and whether management can turn it into a mine. That hasn't changed for Evion.

Everything around it has. As governments wade deeper into critical minerals, getting in front of the right people in Washington has become its own kind of asset.

The officials writing the policy and running the funding programs are hard to reach, and Sinodinos has spent a long career working with them.

He gives Evion a way in. Three decades at the top of government and diplomacy, and a live network across the US groups chasing critical minerals supply right now.

Where to From Here

That reach is the part a junior usually can’t buy, and Evion now has it sitting across three of the four Quad nations.

The doors Sinodinos can open, US funding programs and the offtake talks that follow, are the ones Evion has to walk through to turn a handful of critical minerals assets into something bigger.

There’s hard yards between here and there. CARP is freshly acquired and the real graft is still ahead, and a company this size chasing American money will need more of its own to get there.

That's the bet with any early mover. Few get to make it with a man who's stood in the Oval Office beside the President.

Go back to that photograph. A former ambassador, shoulder to shoulder with the President, in the room where the decisions get made. He has now put his name beside fluorspar in Nevada, graphite in Madagascar and a plant in India.

Whether the rock and the relationships add up to something, nobody knows yet.

But Arthur Sinodinos has looked at a four-cent stock and decided it is worth his time, and men like him do not spend it cheaply.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (“Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 4,500,000 EVG shares at the time of publishing this article. Equities Club has been engaged by EVG at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

Then the gun went. One record fell all weekend, and a Greek swimmer set it clean. The juiced-up games limped out of the blocks.

The real action this week was a long way from Las Vegas. Across commodities, defence and tech, investors got a proper run of news. Europe drew a line in the sand on chips, and the lithium cheques came back out. The biggest mover of the lot was a coal stock that had been left for dead.

Closer to home, our portfolio kept ticking. Revenue landed, fresh samples came back, drills started turning and the big thematics gathered pace.

Let’s get to it.

• KTK turns its IPO into revenue, fast

• Humanoid robots start moving onto production lines

• EVG returns high-grade fluorspar samples in Nevada

• AZ9 keeps hitting massive sulphides at Red Hill

• 10X kicks off maiden drilling at Balerion

• Europe’s €120 billion bid for chip independence

• Coal pulls serious capital as a small-cap goes vertical

• Lithium money keeps flowing at both ends of the market

KTEK: A Week From Bell to First Invoice

KTEK Aerosystems (ASX: KTK) rang the ASX bell less than a fortnight ago, and this week it shipped product and booked revenue against it.

Plenty of freshly listed small-caps are still all promise at this stage. KTK is already getting paid.

The first delivery since listing booked $500,000 in revenue.

KTK makes the parts that go inside drones, and leaves the job of bolting together finished aircraft to someone else. Governments are spending a fortune on drones already, and every budget you look at says they're about to spend far more. Actually winning those contracts, though, is a knife fight.

KTK sits that fight out.

Whichever drone-maker takes the tender, KTK's components are in the aircraft, and KTK gets paid either way.

Management is aiming for 150 units a month inside five months. On their own numbers that works out to around $9 million a year from customers KTK already has, before a dollar of the IPO money goes to work.

More Tier-1 contractors are being courted, and the “Cordless Factory” model, which lets KTK grow without pouring money into a factory of its own, keeps expanding.

Most early defence manufacturers never make it past the certification grind. KTK spent years clearing the audits and approvals to supply the people who build the drones, and this week that work started showing up as revenue that’s real and repeatable. It’s a big tick for a small-cap.

The Robots Are Real Now, and They Need Rutile

Fortuna Metals (ASX: FUN) is sitting at 13 cents and a market value of around $37 million, and one of the commodities it’s chasing through rutile could end up in the middle of one of the biggest manufacturing shifts of the next decade.

Humanoid robots have spent years feeling like tomorrow’s technology that never quite arrives. Every few months a video does the rounds of a robot pulling off a backflip, everyone gets excited, then it goes quiet again.

That’s now changing with BMW. The carmaker is putting humanoid robots onto its vehicle production lines, joining a run of global manufacturers already trialling human-shaped machines on the factory floor.

The thinking behind it is almost dull in its obviousness. Factories and warehouses were built for people, so rather than redesign every workplace around some purpose-built machine, you build a machine shaped like the worker the place was made for.

The military has landed in the same spot, trialling humanoids to haul supplies and drag wounded soldiers out of places you would not send a person.

Ukraine is already chasing tens of thousands of robotic systems this year as the tech moves from concept to the battlefield.

For investors, the question worth sitting with is what these machines are built from. Humanoids need lightweight, high-strength materials that can handle constant movement without chewing through power. Titanium sits near the top of that list.

Rutile is one of the key feedstocks for titanium.

The humanoid story is only getting bigger with some of the largest car makers, industrial names and defence groups in the world prioritising them.

Demand has to work its way back up the chain to the raw materials that make it all possible, and rutile is the very start of a humanoid.

10X Drills Ground the 90s Left Behind

The wait is over for Exultant Mining (ASX: 10X). Since it listed in December the company has been heads-down in soil sampling, IP and gravity surveys, building the case for where to put a rig.

This week one finally started turning at its Balerion Prospect in New South Wales.

Twelve holes, 3,425 metres of RC drilling, chasing copper, silver, lead, zinc and gold across ground that has already given up high-grade hits.

We've said before that discoveries are made long before the first hole goes down. The graft is in the data and the targeting. Now the theory meets the drill bit.

Two explorers drilled this ground in the 90s. One of them pulled 4.4 metres grading 342 grams of silver a tonne, lead and copper running with it.

Then they did the only sensible thing anyone could with metal prices where they were. They stopped drilling and left.

The grades stayed in the rock, and so did the fault underneath it, the same one that fed Captains Flat through 80 years as one of the biggest base metal mines NSW ever ran.

Cheap metal sent everyone home, and now expensive metal has brought the rig back.

The program is built to test it from several angles, soil chemistry, IP, gravity, magnetics and the old drilling all pointing at the same ground. It’s a campaign with several shots at a result.

At 18.5 cents, 10X is the smallest name in our portfolio. These are early days and a discovery is far from guaranteed, but for a company valued where 10X is, even one good hole brings a lot more eyes with it.

Drilling should run for the next four to six weeks, with assays coming back as they clear the lab.

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America Forgot About Fluorspar. It Remembers Now.

The US hasn’t pulled fluorspar out of its own ground since 1990. China makes around 59% of the world’s supply now.

For 35 years that suited everyone. The rock came cheap from somewhere else and nobody asked where.

In January the Pentagon wrote a US$168.9 million cheque to restart a single mine in Utah, rock grading 60 to 70%, just to get American supply moving again.

This week Evion Group's (ASX: EVG) Carp project in Nevada returned surface samples grading up to 88.15% calcium fluoride, independently verified, with several of the old mining areas clearing 80%. Higher-grade rock than the Utah mine the Pentagon just paid to reopen.

These are hand-picked surface samples, not what the whole deposit grades, and Carp still has to be drilled out. But for a project only recently added to our portfolio, it backs the geology management flagged when they picked it up.

Most investors never give fluorspar a second thought, yet it turns up in semiconductors, EV batteries, refrigerants and nuclear fuel processing.

The US imports all of what it uses despite getting through hundreds of thousands of tonnes a year, and that level of reliance is exactly what policymakers are now trying to unwind.

Carp was a producing mine once. The high-grade rock never left, and EVG now holds far more of the ground around it than when it first picked the project up.

With more than $7 million in the bank and a run of catalysts coming across Nevada, Madagascar and India, you’re starting to get a clearer read on where Evion wants to sit in the critical minerals supply chain.

AZ9: Two Holes, Two Hits, and a Richer Copper

Asian Battery Metals (ASX: AZ9) has flown under the radar for much of the past year. Two holes at Red Hill have changed that.

The first, drilled in May, came back with 18.8 metres of massive sulphide. The second, MU2603, went better. 21.9 metres, and known mineralisation now runs past 155 metres of strike.

Each hole is adding weight to the idea that Red Hill is part of a much bigger mineralised system.

The detail catching attention is chalcocite showing up in the sulphides. Chalcocite is a high-grade copper mineral, and finding it can be a sign the drilling is closing in on the hotter core of the system.

Assays are still to come, so the visuals are only part of the picture, but the geology is pointing the right way and management has already stepped out with more holes to test where it strengthens.

Copper itself is climbing. Codelco, the biggest producer on earth, just posted a 27-year production low, and the metal is trading near the highest it's held all year. AZ9 is drilling a system that gets bigger with every hole, and the company’s well funded with more than $5 million in cash.

The next batch of assays aren’t far away now and they’ll be telling us a lot about how real Red Hill is.

Europe Wants Its Chips Back

One of the week’s bigger stories slipped past most people.

The European Union is lining up a major overhaul of its chip strategy, more than €120 billion aimed at building semiconductors on home soil instead of importing them.

Europe makes around 8 to 10% of the world’s chips today and wants to double that by 2030. Brussels is starting to talk about chip supply the way it talks about energy supply, as something a continent can’t afford to leave in someone else’s hands.

Money like that gets spent in two directions. Building the factories, and backing whatever makes the next chip faster than the last one.

That second part is where Adisyn (ASX: AI1) lives.

Through its graphene semiconductor technology, the company is chasing a path beyond traditional copper interconnects, aiming at better speed, lower power draw and improved thermal performance.

A modern chip moves data through a dense web of copper wiring. Shrink it far enough and copper starts to choke, running hot and slow at scales it was never meant to work at. The whole industry can see the wall coming.

Graphene is one of the materials being looked at to get past that limit, and it’s what AI1 is working on. Europe’s billions will build the fabs. The harder question, how to make the silicon inside them genuinely faster, runs straight through the work AI1 is doing.

As governments commit hundreds of billions to semiconductor independence, anything that can deliver the next step up in chip performance gets more valuable by the day, and the macro backdrop for AI1 keeps building.

A Coal Stock Rocketed. So Much for the Funeral.

Everyone's been writing coal's obituary for years. White Energy (ASX: WEC) put on 195% this week, the biggest gain of any company under $100 million, which suggests the funeral was called early.

The jump took its market cap to around $86 million, on a non-binding term sheet to pick up a metallurgical coal project in Alabama and a large package in Queensland's Surat Basin.

The spark was a sparky. Nathan Tinkler, the Hunter Valley electrician who rode coal all the way to becoming Australia's youngest billionaire before losing the lot, is coming back as executive chair.

The man instrumental in building Whitehaven, the $5 billion miner that swallowed his Aston Resources, is having another go.

Non-binding is the word doing the heavy lifting there. Due diligence, financing, approvals and definitive agreements all still have to land before any of it is real. White Energy said as much itself, flagging there’s no guarantee the deals complete.

The Alabama asset comes with a coal handling plant already built, rail access, and a staged restart aiming at production inside 12 months of switching back on.

Infrastructure that already exists is infrastructure nobody has to fund from scratch.

So a market that supposedly hates coal just bid a coal stock up 195% on the strength of a deal that hasn’t closed yet. For all the noise around AI, defence and critical minerals, a credible path to revenue still gets coal a serious look.

The Big Money is Still Backing Lithium

The most telling signal in lithium this week came from the companies writing the cheques.

Western Australia approved the Mt Holland expansion, doubling spodumene concentrate capacity to 4.4Mtpa, while MinRes and Ganfeng signed off on a fresh $490 million investment into Mt Marion.

Spot lithium is still well off its all time highs, but it’s still very healthy and the biggest players in the game are committing serious money to future supply anyway.

Big investments like these rarely hinge on where the price sits today. They’re built on where management teams reckon demand lands a few years out.

Down at the junior end, Solis Minerals (ASX: SLM) put on 41.2% after locking in a A$6 million placement and pushing ahead with plans to drill in Brazil.

Funding often shows up before the discovery does. Capital’s still there for the stories investors believe can deliver.

Why a Quiet June Might Suit Us

There’s a thing that happens to markets in June, and most people read it backwards.

The volume disappears. Tax-loss selling drags it off, the screens go thin, and the easy assumption is that nothing’s happening and nothing’s about to.

The opposite is usually closer to the truth. A thin market is one with nothing standing in the way of a good result, which is exactly why a strong announcement hits harder in June than it would in a crowded tape.

Commodity prices are holding up, and the money is still walking past the companies that just talk to back the ones that deliver, drill results, resource growth, actual revenue where it exists.

The portfolio’s got drilling results, assays, development milestones and a few commercial calls all due over the coming weeks. Plenty of our holdings are kicking hard into the back half of the year.

The stocks that run in 2026 are the ones putting out real results, one announcement at a time. Finding those companies before the rest of the market does is the whole job, and it’s the one we get up for.

Till next week.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (”Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 1,150,000 AZ9 shares, 500,000 KTK shares, 900,000 AI1 performance rights, 200,000 10X shares, 4,500,000 EVG shares, 1,554,000 FUN shares at the time of publishing this article. Equities Club has been engaged by KTK, AI1, FUN, 10X and EVG at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

The first units since listing are already leaving the warehouse.

Inside the container: 1,100 advanced composite airframe components, packed into 100 finished drone sub-assemblies, heading to one of KTK’s existing Tier-1 customers.

The invoice on this one shipment runs to roughly AUD$500,000. And there’s plenty more to come. The company is targeting 150 units a month inside five months.

At roughly AUD$5,000 a unit, that works out to about AUD$9 million in annual revenue off existing customer contracts, before any of the IPO money goes to work pushing deliveries further across the back half of 2026.

Dekel Keisar, KTK’s founder and managing director, put it plainly:

At 31.5 cents, KTK is valued at roughly 5 times that $9 million revenue run-rate.

For context, Electro Optic Systems (ASX: EOS) trades closer to 14 times revenue and Elsight (ASX: ELS) sits north of 35 times.

KTK is the cheapest of the three.

Supply Lines Reopen

When we wrote up KTK last week, the conflict in the Middle East was still hot and the region’s supply chains were running on rations.

Components dribbled through when they could and production sat at a fraction of capacity.

The order book for KTK kept piling up while the parts to fulfil it sat on the wrong side of a border.

The picture has shifted in the past few days. The US is leaning hard on every party in the room to get a peace deal across the line, and the freight lanes have responded faster than the diplomats trying to negotiate peace.

Trucks are moving. Ports are clearing. The European facility has now cleared the first shipment out the door.

It’s still a fragile setup. A peace deal that’s being negotiated by the hour can come apart by the hour. But for the first time since KTK rang the bell, the parts are flowing where the orders are.

What the Shipment Feeds Into

The shipment announced today was half a million dollars. The cycle it feeds into runs to hundreds of billions.

The US has earmarked US$75 billion for drones and counter-drones in its FY27 defence budget. NATO is targeting 5% of GDP on defence by 2035. Europe has pooled US$870 billion for rearmament. Australia is in for AUD$22 billion over the decade.

It’s a procurement cycle so large it has its own acronyms (DAWG, DDP, JADC2, pick your alphabet), its own committees, and its own line in the budgets of dozens of governments.

The big drone-makers are the ones running the procurement gauntlet and winning the government contracts. KTK isn’t in that fight.

KTK supplies the parts that go inside the drones those contracts pay for, which means whichever drone-maker wins the tender, KTK’s parts are still in the aircraft and KTK still gets paid.

The drone-makers buying from KTK today include Elbit Systems and UVision, two of the most established names in the Israeli defence drone industry. The drones they sell, with KTK components inside, are flying in active conflict zones and sitting in the stockpiles of Western defence forces.

Two more Tier-1 names with combined revenues above US$10 billion have already cleared KTK as an approved supplier.

Getting to that stage takes between one and three years of facility audits, aerospace certifications, prototype runs and small initial orders.

The grind that buries most early-stage defence manufacturers before they ever ship at scale has already been ticked off by KTK.

One shipment is small in the scheme of what’s to come. The supply chain underneath it is built to ship years of them.

How KTK Ramps Without Needing a Factory

Most small defence companies, sitting where KTK is sitting today, would announce a factory.

A press release would go out. The capital raise would follow. Shareholders would get diluted to fund the concrete, the machines and the floor staff. By the time the doors opened, the order book would have moved on.

KTK has spent the past seven years building a way to not do that.

The model is called the Cordless Factory. KTK keeps the engineering work, the structural design and the quality assurance in-house, sitting with the team that has the certifications and the customer relationships.

The actual making of things, the cutting and laying and curing and assembling, sits with a network of aerospace partners across Israel, Europe, Thailand and the US.

When demand grows, KTK allocates more work into the network.

The proof is in the numbers from before the IPO. KTK quadrupled revenue between FY23 and FY25 without going back to shareholders for cash. Same share register, four times the revenue.

That’s the engine that gets KTK from the 100 units shipped this week to the 150 a month target.

The IPO money sitting on the balance sheet will push it even further than that.

What Lands Next

The shipment that left this week is the start of a list. Four things to watch for from KTK from here.

• The next Elbit and UVision invoices. This week was 100 units. The 150-a-month target covers contracted demand from those two customers, and every monthly shipment between now and then is a revenue line the market can see.

• The first purchase order from a new Tier-1. Two more Tier-1 names have already cleared KTK as an approved supplier. That's the hard yards done. The next step is converting that paperwork into an actual purchase order, then into a supply agreement that locks KTK in across a multi-year platform.

• The US partner. American drone procurement is the biggest single piece of the global cycle, and a lot of that money requires US-located manufacturing to qualify. KTK has flagged the US as the next geography to add to the Cordless Factory network. The sooner that partner is online and certified, the sooner KTK is eligible to ship into American programs.

• Growth outside defence. KTK also supplies agricultural and delivery drone operators, which sit completely outside the defence budget cycle. Any traction in that part of the book is upside on top of the defence story.

Our View

Less than two weeks ago, KTK rang the bell at 20 cents with a story about ramping into the biggest defence buildup since the Cold War and converting an existing order book into recognised revenue.

This week, the first container since listing is on its way to a customer, the invoice is sitting at half a million dollars, and the company is targeting 150 units a month inside five months.

The world has decided it needs more drones. The companies KTK supplies are the ones building them. KTK has spent seven years getting to the point where it can ship parts into that demand at scale.

This week was the start of it showing up.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (“Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 500,000 KTK shares at the time of publishing this article. Equities Club has been engaged by KTK at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

AZ9 picked up the project in southwestern Mongolia back in April, for less than a million US dollars.

The first hole, drilled in May, came back with 18.8 metres of massive sulphide.

The second hole, announced today, has gone better. 21.9 metres of sulphide, with a mineral called chalcocite turning up in the core for the first time.

The copper that had been coming up in the earlier core was bound up in chalcopyrite, the standard workhorse copper mineral. Chalcocite carries more than twice as much copper per chunk of rock.

When chalcocite starts showing up in a system like this, the drill is usually getting closer to where the system was hottest and richest when the rocks formed hundreds of millions of years ago.

So the picture from two holes: each one thicker than the last, and the copper in the rock getting richer as the drill goes. The mineralised strike across Red Hill now runs more than 155 metres.

All of this against a copper price up 27% over the past six months, and the worst run of supply disruptions the industry has seen in years.

AZ9 still trades at 2c on a market value of around $15 million, with $5.2 million in the bank. Assays from these drill hits land in the coming weeks. If they come in where the visuals are pointing, the stock likely won't stay this quiet for long.

Who's Running AZ9 and What They’ve Got

Gan-Ochir Zunduisuren spent years inside the boardroom of Oyu Tolgoi, the Rio Tinto-operated mine in southern Mongolia that ranks among the largest copper-gold deposits on the planet.

He sat there as the Mongolian government’s representative, the person whose job it was to understand how the rock came out of the ground and where the money went when it did.

He runs AZ9 now.

The company is built around its Yambat ground in southwestern Mongolia, where it made the Oval discovery in late 2024. Oval is a copper-nickel-PGE deposit with a five-million-tonne resource and first-pass metallurgy that came in above 90% recovery, which is what put AZ9 on the map.

Red Hill sits eight kilometres from Oval, on the same belt.

So when the rig hit massive sulphide on the first attempt at Red Hill, it was confirming what AZ9 already had reason to suspect from the rocks at Oval. The belt works.

The Hole the System Has Been Waiting For

Red Hill is what geologists call a volcanogenic massive sulphide system (VMS). In plain English: thick layers of sulphide minerals that were deposited by hot fluids venting onto the seafloor 100s of millions of years ago, then buried under younger rock and preserved.

The highest grades in a system like this sit closest to where the hot fluids came up through the seafloor. That spot is called the feeder zone.

Find the feeder, and you find the part of the system worth building a mine around. That is the prize AZ9 is hunting at Red Hill.

So far there’s been two holes drilled, for two hits.

The first hole, drilled in May, pulled 18.8 metres of sulphide.

MU2603, announced today, has topped it. 21.9 metres of massive sulphide.

Massive sulphide is rock that is essentially solid metal-bearing mineral, packed tight all the way through. Think of the difference between a thin layer of icing on a cake and a 21.9-metre slab of pure icing.

The thicker the slab, the bigger the deposit can grow once the drilling fans out from it.

The new hole was drilled 50 metres south of an older drill hole, MU2502, and intercepted the same sulphide lens about 75 metres up-dip.

In plainer English: the system is bigger than the old hole suggested, and sits closer to surface than previously thought. Shallower copper is cheaper copper to pull out of the ground.

Visible chalcopyrite and chalcocite are running through the core. Chalcocite is the high-grade copper mineral that we flagged earlier in the article, showing up in the drill core for the first time.

Globally in 2026, only 18 companies have reported a copper drill hit grading better than 2% over more than 20 metres of length.

Most of those companies are valued in the 100s of millions of dollars. If the assays from MU2603 land where the visuals are pointing, AZ9 joins that list at a very cheap $15 million market value.

AZ9 picked up Red Hill in April on a mining licence valid until 2045, so there is no tenure clock running on any of this.

The rigs keep turning, and assays will soon tell us what the rock actually grades.

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The System Keeps Growing

Two more holes pushed out from MU2603. One went west and one went east. Both came back with something to look at.

MU2604 was drilled to the west. The hole hit a 3.6-metre band of copper and zinc-rich sulphide inside a wider 15-metre mineralised zone. That intercept extended the known copper system at Red Hill out to more than 155 metres long.

Two months of drilling with 155 metres of system traced. The drill keeps finding rock that nobody had ever turned the ground over for.

The eastern hole, MU2602, drilled into a 44.5-metre thick zone of weathered, rusty rock with chalcopyrite veins running through it at depth.

Rusty rock above a sulphide system is what geologists call a gossan. It is what happens when sulphide minerals close to surface have been weathered by water and air over millions of years, leaving behind iron oxides that stain the rock red and brown.

Gossans are smoke trails. They sit on top of bigger sulphide systems underneath. Finding one means there is probably more to drill below it. Drilling east at Red Hill is now firmly on the to-do list.

So in two months, AZ9 has drilled four holes at Red Hill. The first two went into the main lens and hit massive sulphide on both attempts. The third extended the system west. The fourth turned up a gossan to the east, pointing the drill at the next target.

The system is bigger than the first hole suggested, and the drill hasn't found the edge of it yet in either direction.

The chalcocite in MU2603 also points the drill where it wants to go next. AZ9 has flagged that grades may zone higher toward the west-northwest, and MU2604 is already drilling in that direction.

The 2% Question

We’re speculating that MU2603 could come back at copper grades around 2%. The assays will settle that one way or the other, and they are four to five weeks away.

Historic hole MU2501, drilled during the due diligence phase before AZ9 bought the project, returned 14.5 metres at 2.23% copper and 0.73g/t gold from 132.5 metres. Red Hill has already produced a 2%+ copper hit, in the same mineralised lens that MU2603 has just drilled through.

Visuals are visuals, and grades are grades, and the only thing that closes the gap between the two is the assay lab.

The 2%+ grade in this system is a hole in the ground that AZ9 already has on the books.

If the assays come back anywhere near 2% over a 21.9-metre interval, AZ9 will be sitting on one of the rarer copper drill results of the year, at a market cap below most of its peer group.

The Copper Backdrop Is Doing Some Heavy Lifting

Behind the price move is a supply squeeze that has gone from chronic to acute. Codelco, the biggest copper producer on earth, just fired an executive after audits showed a 27-year production low. Anglo American and Glencore have hit fresh permit delays at Collahuasi, the world's sixth largest copper mine.

Cochilco, the Chilean copper commission, named Mongolia as one of the producing regions expected to help fill the supply gap, alongside the DRC, Zambia, Canada and the US.

Copper futures are trading around US$6.47 a pound on COMEX, the highest level the metal has held all year.

AZ9 is drilling in the exact bracket Cochilco is pointing at.

Where AZ9 is at

The assays for the first hole come back in around two weeks, and the bigger batch covering the headline 21.9-metre intercept and the two flanking holes follows four to five weeks behind that.

A gravity survey is already running across the ground, and the rig is moving onto the shallow gold target at MU2501, where a historic hole in the same lens once returned 2.23% copper over 14.5 metres.

The company is sitting on $5.2 million in cash, so the rigs keep turning whether the market is paying attention or not.

If the assays come back anywhere near what the visuals are pointing at, AZ9 is holding a result that very few junior explorers have produced this year, in a market that is already short of the metal.

If they come back softer, the system is still bigger and richer than it was a month ago, and there is plenty of ground left to drill.

Either way, the rig keeps turning, and the next month is the one to be watching.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (“Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 1,150,000 of AZ9 at the time of publishing this article. Equities Club has been engaged by AZ9 at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No. 519872

This week the rock came back signed off.

Surface samples from EVG’s Carp project in Nevada have come back grading up to 88.15% calcium fluoride. And three of the historic pits on the property cleared 80%.

The mineral they’re chasing is called fluorspar. It’s the unglamorous backbone of the lithium-ion battery, the semiconductor chip, the uranium fuel cycle and most modern refrigerants.

China produces 59% of the world’s supply. The United States produces none, and hasn’t since 1990 (which it recently realised is a big issue).

In January, the Pentagon wrote a US$169 million cheque to a single mine in Utah to restart American supply.

That’s the room EVG is now walking into with verified, ultra-high-grade rock on US soil.

Carp now puts EVG ahead of the only other ASX-listed company chasing US fluorspar - but more on that below.

At 5.5c, EVG trades on around $40 million with over $7 million in the bank. That’s enough cash to fund the next stage of work at Carp, push their Maniry graphite project in Madagascar toward a long-awaited mining permit, and keep the company’s Indian graphite joint venture filling out its order book.

Mal Randall also joined as chair last week, bringing 45 years in resources and 25 of those inside Rio Tinto, with current chair seats at Argosy Minerals (ASX: AGY) and Hastings Technology Metals (ASX: HAS). He doesn’t take chair roles at this point in his career on a whim.

Today’s verification is the first of several catalysts EVG has flagged for the months ahead.

What Fluorspar is and Why the US Wants it

Open the back of any modern phone and you’re looking at fluorine. Not in any obvious way, but in the lithium salt that lets the battery hold a charge, and in the way the chips were etched.

Open the air-con unit on the office wall. Fluorine.

Open the cooling system of a data centre. Fluorine.

The fuel rods inside a nuclear plant. We don’t recommend opening those. But fluorine again.

You get the idea.

All of it traces back to one rock. Crush fluorspar, refine the high-grade material, add water, and you have hydrofluoric acid, which is the upstream feedstock for almost every fluorine chemical the modern economy depends on.

The US consumes around 380,000 tonnes of fluorspar a year to feed that demand. None of it has come out of the ground in America since the early 90s.

For most of those 35 years, it didn’t matter. The supply came cheap from somewhere else, and the somewhere else was usually China.

Given the goings-on in geopolitics these past few years, it matters a lot now.

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The Cheque That Changed The Conversation

In January, the Pentagon awarded a US$168.9 million supply contract to Ares Strategic Mining for its Lost Sheep mine in Utah. The deal can scale to US$250 million over five years.

Ares is the only fully permitted fluorspar mine on US soil. The contract is Washington’s first serious move to rebuild domestic supply, and the cheque is sized appropriate to how much the Department of Defense wants fluorspar.

Lost Sheep historically produced fluorspar at grades around 60% to 70%. It’s the only US-based comparable the Pentagon has put real money behind, which makes what Carp returned this week worth measuring against it.

The Carp samples came back grading up to 88.15%, with three of the four historic pits clearing 80% on rock straight out of surface. That’s well above the grade Washington is currently paying to restart.

And EVG isn't the only ASX-listed company that's noticed the opportunity.

Carp vs The Peer Next Door

The Carp mine shut when cheap imports walked the economics of small US producers off a cliff in the early 70s. The rocks stayed in the ground. The price of fluorspar, and the politics around who supplies it, moved on.

OD6 Metals (ASX: OD6) is working the Quinn Project around 220km north of Las Vegas. EVG and OD6 trade at similar market caps and are chasing the same opportunity.

Two ASX juniors, same commodity, same country. The difference is in the detail.

OD6’s best surface work to date is a 12-metre channel sample at 68.9% from its Horseshoe prospect, with a peak grade of 79.7%. That’s commercial-grade fluorspar from real work on the ground, and it’s why the market’s paying attention.

The company also points to 1957 Union Carbide flotation testwork on a sample from its Mammoth prospect, which returned a 97.83% concentrate. OD6 has been upfront that the result is nearly 70 years old, never JORC verified, and yet to be repeated under modern conditions.

Carp’s headline 88.15% came out of the rock at surface this week, signed off by an independent geologist working to the JORC Code. The peak in OD6’s modern work is 79.7%.

Both stocks have plenty of work ahead. EVG starts with higher-grade rock on a fresher dataset, a producing-mine history on the property, a binding option over 100% of the ground at Carp, and more cash in the bank to put it to work.

What 88% Actually Means

Fluorspar gets sold in two grades:

• Metspar (above 60% CaF₂) goes to steel mills as a flux.

• Acidspar (above 97%) goes to chemical plants making hydrofluoric acid, which is the upstream feedstock for AI chip etching, EV batteries, nuclear fuel, refrigerants and a long list of industrial chemistry.

The higher the grade, the more the buyer pays.

Most fluorspar mines pull rock out of the ground at somewhere between 30% and 60%. They then put it through a processing plant to clean it up to the grade their customer wants. That processing step costs money, time and chemicals, and the higher the grade coming out of the ground, the less of it you have to do.

The peak grade at Carp came in at 88.15% from the West Pit, with an adjacent five-metre body at 78.29%. The North Pit and Central Pit also cleared 80%. South Pit topped out at 75.62%.

14 of 25 samples landed between 49.83% and 88.15%.

The high grades also came back from four different rock types: flat sheets of mineralisation, steep veins, replacement bodies, and rock running along old fault lines.

Four styles, spread across four pit areas. That points to a whole mineralised system across Carp.

The original mine ran on 69% rock between 1958 and 1971. The new sampling has come in well above that grade across multiple pits. The bits the old miners didn’t get to are sitting at higher grades than the bits they did.

The samples also threw up a touch of gold, and one separate rock type came back with strong grades of silver, copper, lead and zinc.

None of that is the main game at Carp. But it’s free upside sitting on top of the fluorspar.

Rock chips are selective hand-picked samples and don’t represent bulk grade. Carp still has to be drilled out, met-tested and worked up the development curve.

The Rest of EVG

There’s more to EVG than the fluorspar story.

The company started life as a graphite developer and only expanded into fluorspar earlier this year.

The Maniry graphite project in Madagascar is weeks away from its mining permit. The country’s Mines Ministry has directed the Mining Cadastre to process it.

The 2022 feasibility study put Maniry’s pre-tax net present value at US$263 million over a 21-year mine life, and a €3 million EU grant unlocks with the permit.

EVG also runs a 50/50 graphite joint venture in India that’s been shipping expandable graphite into international markets since March, including a A$1.5 million order to a US buyer in December.

Fluorspar in Nevada, graphite in Madagascar, processing in India, with no Chinese partners anywhere in the chain.

Half of Washington has spent the past two years trying to assemble what EVG already has.

What Happens Next at Carp

EVG has more than quadrupled the project footprint in the lead-up to this week’s results.

The original Carp ground covered 14 mining claims over 117 hectares. EVG has now staked another 45 claims alongside it, running in the same direction the high-grade rock runs underground.

The full holding now covers around 493 hectares.

The work program from here:

• Systematic surface sampling across the new ground to test whether the high grades extend along strike.

• Detailed geological mapping to refine drill targets.

• Permitting with the US Bureau of Land Management, the federal agency that approves drilling on public land in Nevada.

• First drill holes once permits land.

Two targets sit ahead of the drill rig. The depth extensions of the steeply dipping veins already returning high grades at surface. And new manto-style targets across the expanded ground, the flat-lying sheets of mineralisation that built the historic Carp mine.

EVG has flagged a detailed update on the field program shortly.

We’re at surface samples now, but drill holes are what could turn Carp from a high-grade sampling story into a project Washington and its allies can actually buy from.

That’s the moment we’re waiting for.

Where to From Here for EVG

Carp has put rock at surface that most fluorspar juniors would kill for.

At 5.5c on around $40 million with over $7 million in the bank, the work from here is execution.

Three things can move this stock. A drill rig in Nevada. A piece of paper in Madagascar. And a growing list of American buyers placing orders with a graphite plant in India, for the simple reason that they would prefer not to buy from China.

Any one of them can reprice a $40 million stock.

For a country that spent 35 years not caring where its fluorspar came from, EVG is starting to look like a useful little ASX-listed reminder.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (“Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 4,500,000 EVG shares at the time of publishing this article. Equities Club has been engaged by EVG at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

AI1 is up around 270% since we added it. EVG is up more than 80% in a fortnight, after ripping 60% on its opening day. And this week KTEK Aerosystems (ASX: KTK) joined the portfolio, listed at 20c on Monday morning, and closed the week at 38c.

Ninety percent up in five sessions. The kind of start most listed companies don’t see in their first year of trading, let alone their first week.

The thread tying all three together is the same one running through the whole small-cap end of the market right now. Money is moving fast into defence and critical minerals, and the smaller end of the ASX is where that money keeps finding its biggest leverage.

The rest of the portfolio moved with it. Mount Ridley kicked off the metallurgical work that decides whether its heavy rare earths actually come out of the ground, and Evion brought in a 45-year mining veteran as chair.

Outside the portfolio, the man who built Northern Star from a $363 million WA junior into Australia’s largest gold producer stepped down. We’ll get to him further down.

Let’s get to it.

• KTK closes its first week on the ASX up 90%

• Defence and drones move into the hottest pocket of the small-cap market

• Mount Ridley shifts from rare earths discovery toward processing

• Evion brings in a 45-year mining veteran as chair

• Patrys lines up the clinical trial site for the delirium program

• The MD who built Northern Star from $363m into a $27 billion giant steps down

• Guzman y Gomez rallies after walking away from the US

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KTK Closes Its First Week Up 90%

Somewhere on the Tel Aviv outskirts in 2019, an Israeli structural engineer named Dekel Keisar was working on a counter-theory.

Everyone else in the defence industry was building bigger, more expensive flying platforms. Dekel had spent his career inside that industry.

He thought it had the future backwards.

The drones that would matter, he’d decided, were the cheap ones. The ones you could build by the 1000s and lose without having to write a memo to a general.

Seven years later, the Pentagon agrees with him. KTEK Aerosystems, the company Dekel started with that hunch, listed on the ASX this Monday at 20 cents. It closed the week at 38, up 90%.

For new readers, KTK builds the components that go inside military drones. Wings, frames, landing gear, electromechanical assemblies. The names on the finished platforms, Elbit, UVision and the rest, buy those parts and bolt them in.

It’s the picks-and-shovels play of the drone boom.

We went long on the full breakdown on Monday. The IPO closed three times oversubscribed, with $30 million in bids for a $10 million raise that filled in under 24 hours.

Regal Funds Management, Thorney Investment Group and US-Israeli defence fund Scopus Ventures are on the register. Board and management hold 44%, while the top 20 holders sit at 70%.

Speaking with Dekel last week, one line stuck with us. He’d been attracted to small drones 20 years ago, when nobody in the industry took them seriously.

“Back then, most of the industry was focused on big, expensive flying platforms. I thought it makes sense to have small platforms, cheaper platforms, that you can manufacture in huge capacities … now that is what actually happens,” Dekel said.

The man bet his career on what the Pentagon now openly embraces. And the numbers behind that shift are extraordinary.

For KTK specifically, the move from here is operational. First purchase orders from the two newly approved Tier-1 contractors. A US manufacturing partner online. New customer wins beyond the existing book.

Each one is a chance for the market to re-rate.

Mount Ridley Moves From Discovery Into Processing

There’s a moment in the life of a junior critical minerals story where the question shifts.

It stops being “Have you found something” and starts being “Can you actually get it out of the ground?”. Most companies never make the shift. The graveyard of ASX rare earth juniors is full of names that had a resource, couldn’t crack the chemistry, and quietly disappeared.

Mount Ridley Mines (ASX: MRD) started making the shift this week.

The company kicked off Phase 1 metallurgical testwork at Perth lab Nagrom, running the heavy rare earth, scandium and gallium mineralisation from its Grass Patch project through the chemistry that decides whether the rocks become a mine or a footnote.

You can find our full note on this week’s news here.

Running the program is Chris Larder, who joined MRD three weeks ago after spending 30 years building flowsheets in WA, including time at Alcoa’s Wagerup gallium plant and Lynas’ Mt Weld rare earth separation facility. The two WA operations MRD’s basket could realistically feed into.

The piece of this story we keep coming back to is the comparison with Victory Metals (ASX: VTM). Same clay-hosted, heavy-loaded deposit style. Same WA jurisdiction. VTM is well into pre-feasibility on its North Stanmore project with strategic partners on the books, and the market values that work at around $170 million. MRD sits at around $39 million.

That’s just under five times the gap on the same style of deposit, with one detail in MRD’s favour. VTM’s resource holds heavy rare earths and scandium. MRD’s holds all of that, plus gallium. The full set. And Grass Patch sits 25 kilometres from port in WA, which is a head start most of its peers don’t have.

Phase 1 doesn’t close that valuation gap on its own. The work in front of Larder’s team is the work VTM was doing two years ago. What it does is start the technical case the rest of the development pathway gets built on.

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The Defence Pivot on the ASX

Three years ago, a Russian tank cost millions of dollars and a Ukrainian drone cost a few thousand. The tank won that fight every time.

Now, the tables have turned.

The footage coming out of eastern Ukraine over the past 18 months has done more to shift Western defence procurement than any think tank report ever could.

There’s numerous clips around the internet of a backpack drone taking out a piece of armour that took a year to build and a decade to design.

The maths of war has been rewritten in front of a live audience.

The Pentagon, NATO and the Australian Defence Force have all seen the same footage and arrived at the same conclusion. The next war is going to be fought with things that cost less than a used car, built at mass scale.

Behind it sits Australia’s $15 billion commitment to autonomous systems, NATO targeting 5% of GDP by 2035, and Europe’s US$870 billion rearmament pool. The money has to find somewhere to go.

Some of it is finding the ASX.

Adisyn (ASX: AI1) has been on a run as the market has worked out what graphene stealth coating means for a drone the size of a quadcopter, and KTK turned a lot of heads in its first week on the ASX.

The trade has now spread well past what we own.

1414 Degrees (ASX: 14D) ripped another 60% this week on its aerospace and defence battery materials pivot.

AnteoTech (ASX: ADO) jumped 40% after validating drone applications for its Ultranode battery technology.

Both were industrial materials stories 12 months ago, and are now defence stories, because the money inside the sector has decided that’s what they are.

The thing to remember about defence trades is they don’t usually run on quarters. They run on procurement cycles, and the cycle that just opened is the biggest one since the Cold War.

The companies sitting inside it now are the ones that get to compound and the market is finally waking up to where the next generation of defence spending is heading.

Big Changes at Board Level as EVG Ramps UP

Evion Group (ASX: EVG) spent the week reshaping its leadership team, and the stock finished about 10% higher at 5.5c.

The headline appointment was Mal Randall stepping in as non-executive chair.

Randall brings more than 45 years across the resources sector. Senior Rio Tinto roles. Lithium, rare earths, graphite and broader critical minerals development. A career that’s run through every cycle the Australian resources sector has produced since the 1980s.

He doesn’t take chair roles on a whim at this point.

EVG has a few moving parts inside the business now, and they’re all maturing at the same time.

The newly acquired Carp fluorspar project in Nevada gives the company exposure to a mineral that quietly underpins lithium-ion battery electrolytes, semiconductor manufacturing, uranium enrichment and refrigerants.

China controls global supply. The US imports effectively all of it.

That’s the kind of imbalance Western governments have spent the past two years actively trying to fix.

Alongside fluorspar sits the Maniry graphite project in Madagascar, advancing toward Final Investment Decision under the EU Critical Raw Materials framework.

Graphite remains one of the core inputs for lithium-ion battery production, and Maniry is well advanced compared to most ASX peers in the space.

Underneath those two sits the Indian graphite JV, which already generates revenue and ships into international markets today.

The company also strengthened the technical bench this week with geologist Mark Fletcher, whose background spans nickel sulphides, gold and IOCG systems.

A year ago EVG was a graphite story.

Today it sits across fluorspar in Nevada, graphite permits in Madagascar, revenue in India, and a Rio Tinto-pedigree chair at the top.

This increasingly feels like a company trying to build a diversified critical minerals platform across multiple commodities, jurisdictions and revenue pathways rather than relying on one standalone project outcome.

PAB Lines Up Its First Human Trial

Patrys (ASX: PAB) climbed nearly 20% this week after the company lined up the two pieces it needed to put RLS-2202 into actual humans.

RLS-2202 is an injectable designed for acute care, where the target is delirium.

The Phase 1A trial site is now CMAX, one of Australia’s most established clinical research facilities. Alithia Life Sciences will run the day-to-day management of the study.

A biotech can talk about a drug for years before anyone actually receives it. Naming the trial site and the operator is the step that moves the conversation out of the lab.

Picture a nurse on a hospital ward at 3am, sitting with an 82-year-old who came in for a hip replacement and woke up confused, agitated, pulling at his IV lines.

That’s delirium. It strikes elderly patients hardest, particularly after surgery or in intensive care. It lengthens hospital stays, slows recovery, and raises mortality.

The patient pool is substantial. Ageing populations across the developed world keep elderly hospital admissions climbing every year, and delirium turns up in a meaningful share of them.

Acute care is a setting where speed matters more than almost anywhere else in medicine, and the treatment options on the ward for delirium haven’t meaningfully moved in decades. PAB’s pitch is that an injectable formulation can deliver faster and more reliably than what’s currently in use.

The company is targeting first participant dosing in Q3 2026, subject to approvals.

Biotech investing changes when a program crosses into humans.

Before that point, the market is pricing a thesis. After it, the market is pricing data. The two are different exercises with different multiples attached, which is why biotech share prices tend to move sharply around the moment of the crossing.

PAB isn’t there yet. But this week the company put the infrastructure in place to get there.

The 30-Bagger Walks Off the Job

In 2013, Northern Star Resources (ASX: NST) was an 85.5c stock with a $363 million market cap and a few WA gold mines on the books. The kind of name that scrolled past most retail investors without registering.

That year, a mining engineer named Stuart Tonkin joined as chief operating officer.

This week, NST announced Tonkin will step down during Q1 next year.

The stock sits at $18.83 and the company is worth almost $27 billion. It runs three major production hubs across Western Australia and Alaska, employs more than 10,000 staff and contractors, and is now Australia’s largest gold producer.

Every reader of this wrap is quietly hunting for a company that goes from speculative to serious while the rest of the market is still looking the other way. Northern Star is the closest the Australian gold sector has come to that template in the last decade.

Tonkin built it through the deals he did along the way.

The Saracen merger reunited ownership of Kalgoorlie’s Super Pit for the first time in generations. The acquisition of De Grey brought Hemi, one of the most significant undeveloped gold discoveries in the country, onto the balance sheet.

Those weren’t the only deals across the decade, but they were the ones that defined what Northern Star was going to be.

The past 18 months have been harder, with production downgrades and operational frustrations.

These are the kinds of pressures that catch up to companies once they get big enough, but the decade that came before is a story to be proud of.

Northern Star sat at the speculative end of the ASX in 2013. The same end where EC readers spend their mornings. The chance to compound a small company into a serious one is still on the table for someone today.

Tonkin’s decade is proof of what it takes to grab it.

Burrito or Bust: GYG Calls Time on America

Guzman y Gomez (ASX: GYG) walked into America in 2020 with its flagship store in suburban Chicago and a plan to take the country.

This week the company walked out with a writedown and an apology.

In response, the stock ripped.

The maths of failure in the US fast-casual market is brutal. Chipotle has been refining its operation for 30 years and runs more than 3,500 stores.

The American consumer has a thousand places to buy a burrito within a half-hour drive of any major city.

A handful of Australian-accented imports in Chicago weren’t going to change that, and the longer GYG kept trying, the more capital it was burning to find out.

Management drew the line this week. All eight Chicago restaurants shut and US expansion plans were abandoned. The company will wear a one-off financial hit exiting the market.

Investors rewarded the retreat, the opposite of what management teams usually get for waving the white flag on a growth story.

GYG upgraded guidance for Australian underlying pre-tax profit to roughly $85 million for FY26, representing growth of almost 30% year on year.

With the US write-off behind them, that growth now sits in front of the market with nothing in the way.

Expensive offshore growth stories that aren’t working have lost their patience this year on the ASX. Capital wants to see discipline before it sees ambition.

GYG had been carrying the US rollout as a question mark on the stock for years. The Australian business was doing the work, and the American one was the story management kept asking the market to believe in.

Even after falling from above $43 to below $20 over the past 18 months, GYG still carries a valuation around the $2 billion mark. That’s the price the market is now willing to pay for a focused Australian business with 30% pre-tax profit growth and no US story attached.

Sometimes the bravest decision a management team can make is the one that admits the last decision was wrong.

GYG made it this week.

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The Week Ahead

May closes out next week.

The small-cap end of the market still feels in better shape than the big end. Defence and critical minerals have been catching bids all month, and neither trade looks done.

Mineral Resources restarted Bald Hill this week. For two years the lithium majors have been writing down assets and pulling production. This was an early move in the other direction.

Sentiment across the smaller end of the lithium space picked up off the back of it, and there are a lot of names down there with operational leverage they haven’t been able to use in quite some time.

Gold is up roughly 50% on this time last year. Half the small-cap gold sector is still priced as though that move hasn’t happened, which means a meaningful chunk of the ASX is sitting on potential margin expansion.

Exultant Mining (ASX: 10X) is the big one we’re sitting on. The maiden NSW drill program is underway and results could land any time. At a $7.5 million valuation, 10X is the smallest company in our portfolio, and positive assays could move the share price quickly.

From our side, the news flow into June is busy. Portfolio companies advancing, drill bits turning, and now a market rewarding the work.

Till next week.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (”Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 500,000 KTK shares, 2,083,333 MRD performance rights, 900,000 AI1 performance rights, 200,000 10X shares, 4,500,000 EVG shares at the time of publishing this article. Equities Club has been engaged by KTK, AI1, MRD, 10X and EVG at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

This morning the company kicked off Phase 1 metallurgical testwork at Perth lab Nagrom, on the heavy rare earth, scandium and gallium mineralisation at the Grass Patch project, 25 kilometres north of Esperance in WA.

It’s the first stage of the work that decides whether the rocks at Grass Patch become a mine or a footnote.

Chris Larder is running the program. He’s spent 30 years on WA flowsheets, including spells at Alcoa’s Wagerup gallium plant and Lynas’ Mt Weld rare earth separation facility.

Those are the two WA operations that MRD’s basket could realistically feed into.

We wrote about Larder joining MRD three weeks back. The program kicking off this morning is the one he's been designing since.

MRD trades at 2.7 cents, valuing the company at around $36 million.

Victory Metals (ASX: VTM), the closest comparable on the ASX, trades at around $180 million.

That’s roughly five times what MRD trades at, on the same style of deposit in the same state.

What’s In The Ground

Back in March, MRD’s maiden resource came in at 122.6 million tonnes grading 889ppm total rare earth oxide, and 41% of those rare earths sit in the heavy basket.

The heavies are the part of the periodic table driving the current critical mineral supply panic, and prices have been running hard while Western governments throw money at projects outside Chinese supply chains.

Inside the same deposit, MRD also holds 18,855 tonnes of contained scandium and 24,584 tonnes of contained gallium.

To put the scandium in context, the entire world produces around 25 tonnes a year, and China controls more than 95% of the world’s gallium.

Both metals are on every allied government’s shopping list, and MRD gets exposure to all three from a single project.

We covered the geology properly when MRD joined the portfolio, so we won’t redo it here. The short version is that the rocks are there in the right mix, in a jurisdiction the West actively wants to be buying from.

What the resource doesn’t tell you is whether the metals can actually be pulled out of the clay at a price that makes a project work.

That’s the question Phase 1 is built to answer.

Why The Heavies Are Running

There are 17 rare earth elements, and most of them are nowhere near as rare or valuable as the name suggests.

The ones the West is currently losing sleep over are dysprosium and terbium.

Both go into permanent magnets in tiny amounts, and they’re what keeps the magnet working when it gets hot.

That’s why you find them inside every EV motor, every wind turbine, every guided missile and every industrial robot that needs to keep running under load.

There’s no substitute for either element, and China controls almost all the global supply.

Last year, Beijing imposed export controls on both. By the time the controls bedded in, Western prices had started running well away from Chinese domestic prices, and they’ve been climbing ever since.

Dysprosium oxide for Western buyers is sitting at around US$930 per kilogram, and Terbium oxide is at around US$4,000 per kilogram

China's export licensing on the heavies has been tightening since it came in last year, which means the setup behind those price moves isn't going anywhere soon.

MRD’s resource holds 4,272 tonnes of contained dysprosium and 719 tonnes of contained terbium. Those are the two metals doing most of the work on the basket value, and they’re the two that Phase 1 is being designed around.

Grass Patch is one of a small group of ASX-listed names with a JORC heavy rare earth resource in a tier-one jurisdiction. Most other WA projects are light-dominant, where the metals trade at a fraction of dysprosium and terbium prices.

But all of that only matters if you can get the heavies out cleanly, and early testwork has already shown the heavies in MRD’s regolith leach more strongly than the lights.

That’s the recovery curve you want, because the highest-value elements come off the clay first.

Phase 1 is the program that puts proper numbers on how cleanly that split can scale.

What Phase 1 Decides

Grass Patch is what’s called a regolith-hosted deposit, which is a fancy way of saying the rare earths sit in soft weathered clay near the surface.

You can mine it with an excavator, which is a big head start on cost.

It’s also the same style of deposit China has built its heavy rare earth dominance on. The ionic clay operations in southern China produce the cheapest dysprosium and terbium on the planet, and the geology at Grass Patch is the western hemisphere’s version of that.

With this style of deposit, everything rides on the leach. The metals are loosely stuck to the clay, and a mild acid wash is supposed to pull them off cleanly.

When that works, the economics look beautiful.

When it doesn’t, recoveries collapse. The graveyard of junior rare earth stocks is full of companies that had a resource and couldn't crack the chemistry.

Larder's team has four jobs at the Winstons and Keiths prospects, both of which sit inside MRD's defined resource:

• Characterise the clay so the underlying chemistry is fully understood

• Test beneficiation, which is the step that strips out the waste and concentrates the good stuff before the main leach

• Develop and optimise the leach itself, which is the chemical step that pulls the rare earths off the clay

• Produce a clean batch of conditioned feed for the next stage of testwork

Get those right and MRD has a baseline the rest of the metallurgical pathway can build on, including the work flowing into the CRADA framework still being drafted with Lawrence Livermore National Laboratory in the US.

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What MRD's Got That VTM Doesn't

Victory Metals (ASX: VTM) is the closest comparable project on the ASX. Same clay-hosted, heavy-loaded deposit style, same WA jurisdiction.

VTM has been at North Stanmore since 2022 and they’re well into pre-feasibility work, with strategic partners on the books. That’s most of why they trade at around $180 million and MRD trades at $36 million.

MRD isn’t trying to leapfrog VTM. The work happening at Grass Patch right now is the same work VTM was doing a couple of years back, and the comparison only gets interesting if you ask what MRD has that VTM hasn’t.

Two things stand out.

The first is gallium. VTM’s resource carries heavy rare earths and scandium. MRD’s carries all of that plus gallium, the only critical mineral in the basket VTM doesn’t have on its books.

The second is the CRADA framework still being drafted with Lawrence Livermore National Laboratory. We’re not aware of any other ASX rare earth junior with that kind of US lab partnership in flight.

Once it’s signed, it opens up US government funding pathways most juniors at this stage don’t have access to.

Phase 1 is the program that starts building MRD’s technical case toward the kind of dataset VTM has already put together.

The valuation gap is what it is. The question worth watching is how fast MRD closes it.

What Comes Next

Phase 1 results are the first deliverable from here. After that, the focus widens to the rest of the development pathway.

The re-assay of historical pulps at Grass Patch should flow into a resource upgrade, partnership agreements are still to be finalised, and a more advanced stage of met work will follow on from this Phase 1 baseline.

Met work is also where junior rare earth projects get validated or quietly fade. Lab recoveries don’t always translate to bulk material, and reagent costs can swing the economics.

We added MRD to the portfolio in March. Phase 1 is the next major test of the case we wrote up at the time.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (”Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club has 2,083,333 performance rights in MRD. Equities Club has been engaged by MRD at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

The drone cost a few thousand dollars. The tank cost millions.

That’s the war now.

In July last year, US Defence Secretary Pete Hegseth signed a memo moving small drones from one accounting category to another. They used to be classified the same way as fighter jets. Now they’re classified as ammunition.

Ordered by the case, and expended by the thousand.

That single memo changed the maths. Annual US military drone purchases ran at around 50,000 last year. They’re forecast to hit 300,000 this year, and over a million within a few years.

The FY27 US Defence budget earmarks US$75 billion for drones and counter-drone systems. NATO is targeting 5% of GDP by 2035. Europe has pooled US$870 billion for defence rearmament. Australia is in for A$22 billion over the decade.

This is the largest defence procurement cycle since the Cold War.

In 2019, an Israeli engineer named Dekel Keisar started a company. He’d spent his career at Israel Aerospace Industries, running the structural engineering on military drones at Israel Aerospace Industries, the country's largest defence company.

Seven years on, that company is called KTEK Aerosystems (ASX: KTK). It lists on the ASX today, and we’re adding it to the Equities Club portfolio.

KTEK Aerosystems builds the parts that go inside drones made by other companies. That's wings, frames, landing gear, electromechanical assemblies and structural sub-assemblies.

The names on the finished drones, Elbit, UVision and the rest, buy those parts from KTK and bolt them in.

Every drone they ship with KTK components inside is revenue back to KTK, without KTK needing to win a single government contract.

It’s the picks-and-shovels play of the drone boom.

Today’s IPO values KTK at $28 million. The drone programs KTK supplies parts into have won more than $2.5 billion in contracts since 2023.

KTK is already pulling in more than $5 million a year in revenue, more than quadrupled in two years. Dekel still owns 36% of the company going in.

The $10 million raise for the IPO filled in under 24 hours. It was three times oversubscribed, with over $30 million in bids. Regal Funds Management, Thorney Investment Group and US-Israeli defence fund Scopus Ventures are all on the register.

The top 20 shareholders hold 70% of the company between them, so there won’t be much paper left this morning.

KTK lists today at 20 cents. We think the rest of the story is bigger than the share price.

What KTEK Aerosystems Actually Does

KTK builds the bits that go inside military drones.

While that sounds simple, the engineering and supply chain behind it are not.

At the top of the chain sit the Tier-1 defence contractors. These are the companies that hold the government contracts, design the drone platforms, and ship the finished product to the military.

Think Elbit Systems, UVision, Textron and L3Harris.

While their names are on the contracts and logos are on the drones, they don’t build everything from scratch. No defence contractor does.

One layer down sit the Tier-2 suppliers. They build the components and sub-systems that go inside the drone. Things like airframes, wings, avionics mounts, electromechanical assemblies, power systems and landing gears.

The Tier-1 contractor takes those pieces, integrates them with software, sensors and weapons systems, and delivers the finished drone to the customer.

KTK is the Tier-2.

What KTK ships into a Tier-1 factory is what the company calls a “full-turnkey sub-assembly”. A ready-to-install drone section that arrives with all the mechanical, electrical and firmware components already integrated and tested. The Tier-1 bolts it in and moves on.

For the Tier-1, that saves months of engineering and production headache.

For KTK, it means they’re not competing with low-cost commodity suppliers on bolts and brackets. They’re delivering engineered systems that took years to design and qualify.

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The Cordless Factory

Most defence manufacturers scale by building bigger factories. That eats capital and locks the company to one country.

KTK runs a different model. The company calls it the “Cordless Factory”.

The engineering, the design work, the quality control and the systems integration all stay in-house.

The physical manufacturing gets contracted out to a global network of certified aerospace partners across Israel, Portugal, the Netherlands and Australia, with US partners next on the list.

The model lets KTK scale production without building new plants. It can move work between facilities depending on customer location, capacity and geopolitics, while avoiding the capital intensity that crushes most early-stage defence manufacturers.

It's how a company doing more than $5 million a year in revenue can already be supplying Tier-1 defence programs at scale.

The model works because Dekel and the team that built KTK came from the other side of the deal.

They spent years at Israel Aerospace Industries and consulting to the major drone manufacturers, working out from the inside what the Tier-1s actually want from a supplier.

The Cordless Factory lets them punch above their weight.

Why "Approved Supplier" Matters

There's a piece of the KTK story most retail investors will gloss over. It's the words "approved supplier".

Getting on a Tier-1 defence contractor's approved supplier list takes between one and three years. You go through facility audits, AS9100 aerospace certification, prototype runs and small initial orders, with performance monitoring throughout, before the Tier-1 trusts you with any real volume.

Once you’re in, you’re hard to displace. Swapping out an approved supplier means putting a competitor through the same multi-year qualification process while disrupting an active production line.

The Tier-1 won’t do it lightly.

That's why a $28 million company can credibly claim a place inside drone programs running $2.5 billion in contracts.

KTK is already inside the supply chains of the companies winning them, and getting another supplier in its place means rebuilding a multi-year process from scratch.

It’s the kind of edge that only gets built over years of work, and KTK has already done it.

Five Reasons We’re Backing KTK

1. The drone supercycle just changed shape

In July last year, the US Defence Secretary picked up a pen and changed how America buys drones.

Small drones used to be procured like fighter jets. Long contracts, big budgets, slow approvals, signed off by senior officers. Pete Hegseth’s memo moved them into the same accounting bucket as bullets. Cheap and expendable and bought by the case. Ordered by the unit commander rather than the Pentagon.

The numbers moved overnight from the memo.

The Defence Autonomous Working Group inside US Special Operations Command had a US$225.9 million annual budget last year. The FY27 budget request hands it US$54.6 billion.

That’s a 240-fold jump to a single line item, in 12 months.

The US Army wants a million small drones. The Pentagon’s separate Drone Dominance Program wants another 200,000 by 2027. Total US military drone purchases ran at 50,000 last year.

They’re forecast to hit 300,000 this year, then over a million within a few years.

While the companies whose names are on the finished drones get the headlines, the Tier-2 suppliers underneath them ship the volume.

Volume procurement rewards suppliers who are already qualified, already integrated into production lines, already shipping into platforms the US military has approved.

KTK is already inside.

2. The board has built one of these before

In 2017, an Australian-listed company called Elsight (ASX: ELS) came to market with a $18 million valuation. It built radio communications for drones.

The chairman who'd helped bring it there was a former semiconductor executive named Howard Digby.

Elsight today is worth about $1.5 billion.

That’s roughly 80 times the IPO valuation over eight years, in the same broad sector KTK is listing into today. Howard’s been on plenty of boards that didn’t 80x. He’s only chaired one drone-adjacent ASX small-cap.

KTK is the second.

Director Chris Baxter sits on the operational side of the table. He's advised Skyeton, a Ukrainian drone manufacturer shipping platforms straight into the war.

Ukraine is the most heavily combat-tested UAV environment on the planet right now, and the lessons coming out of it are reshaping how every Western military thinks about drones.

Non-executive director Winton Willesee sat on the board of DroneShield (ASX: DRO) through its early scaling years.

Three directors. Three ASX drone stories that became serious ones. That isn't common at the $28 million end of the market.

3. The customer base is bigger than the company

A $28 million company sits inside customer contracts worth more than $2.5 billion.

That single ratio is the most striking thing on the KTK page.

KTK's two existing public customer relationships are UVision and Elbit Systems, two of the most established names in the Israeli defence drone industry.

Both names mean a lot in the global drone space, but neither is a household name in Australia, so it’s worth a quick translation.

UVision is planning a Nasdaq IPO at a multi-billion dollar valuation. Its closest US-listed comparable, AeroVironment (NASDAQ: AVAV), is valued at around US$12 billion. Then there’s Shield AI, raising fresh capital at the same US$12 billion mark. Leonardo DRS (NASDAQ: DRS) sits at roughly US$10 billion.

Elbit Systems is one of Israel’s largest defence contractors, listed on both the Tel Aviv and NASDAQ exchanges with a market cap around US$25 billion.

That’s the calibre of company KTK is supplying parts to.

On top of the existing book, KTK has approved supplier status with two more Tier-1 defence and aerospace groups, with combined revenues over US$10 billion between them. Initial purchase orders are expected.

The $2.5 billion customer order book matters more than the headline number suggests.

KTK is already inside the supply chains of the contractors winning the contracts, and that’s the part you can’t replicate at IPO from outside the industry.

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4. Quadrupled revenue in two years, without diluting shareholders

KTK’s revenue went from US$769k in FY23, to US$1.95m in FY24, to US$3.3m in FY25. In Australian dollars, that's around A$5.5 million in FY25.

A 107% compound annual growth rate, and revenue has more than quadrupled in two years.

Most ASX companies celebrate 20% annual growth in a good year. KTK is growing five times faster than that, and onboarding Tier-1 defence contractors at the same time.

Usually that kind of growth at a small-cap manufacturer means going back to shareholders for cash, again and again, to fund the next stage of growth and the next customer ramp. Existing holders get diluted on every raise.

KTK has grown without doing that once.

The model is built to produce a margin profile closer to an engineering business than a manufacturer, and growth that doesn't depend on tapping shareholders every time a customer ramps an order.

5. The register going into listing is unusually tight

Regal Funds Management anchored the KTK seed round in late 2025. They came back for the IPO in 2026.

Regal is the alternatives arm of Regal Partners (ASX: RPL), with $20.9 billion in funds under management, and backing the same company twice at two different price points is about as clear a signal as a fund manager gives.

Alex Waislitz founded Thorney Investment Group in 1991, sits on the AFR Rich List with an estimated net worth around $1.5 billion, and has one of the longest small-cap track records in the country. Thorney is in.

Anton Tagliaferro founded Investors Mutual in 1998 and built it into one of the most respected value houses on the ASX.

His family office TGI Holdings is on the KTK register, and he gave the AFR his read on the listing directly: a “picks-and-shovels play to help facilitate the rapid acceleration in drone production driven by strong demand from defence departments globally.”

Scopus Ventures is a US-Israeli defence and technology fund. Specialist money that looks at defence supply chains for a living. Scopus putting capital into a Tier-2 UAV supplier listing on the ASX is a direct vote on KTK’s engineering and customer relationships.

VP Capital and Cyan Investment Management rounded out the institutional book. Both have spent years picking small-cap names that worked.

Add it all up. KTK has 140 million shares on issue at listing. Board and management hold roughly 44%, locked up. The top 20 shareholders hold around 70% of the register between them. Institutions own about half of what’s left.

That leaves a tiny free float with the potential to move aggressively if the market starts understanding what may be building here.

There isn’t much paper for retail this morning, and the names already holding it aren’t the kind that sell early.

What we’re watching

A few specific things from listing day forward.

• The first purchase order from a new Tier-1. Approved supplier is the hard yards. The next step is converting that into a purchase order, then a second one, then a supply agreement that locks KTK in across a multi-year platform. Each step is a chance for the market to re-rate the stock.

• The US partner network. American drone procurement is the single biggest piece of the global cycle, and a lot of that money will require domestic manufacturing or US-located supply chains. KTK has flagged the US as its next manufacturing geography. The faster they get a certified US partner online, the more programs they're eligible for

• New customers beyond UVision and Elbit. The existing book is concentrated in two names. Every new Tier-1 relationship that turns into revenue opens up more of the market.

• Revenue scaling without major capital raises. The Cordless Factory model is built to allow this. If it works, KTK compounds revenue without going back to shareholders for cash. If they need to raise to fund the next ramp, that's a different story.

Risks

KTK is an early-stage defence company on day one of life as a listed business. A few risks worth flagging:

• Customer concentration. UVision and Elbit dominate the current book. If either pulls back, or the geopolitics around their end-customers shift, KTK feels it.

• Geopolitical exposure. KTK was founded and operates substantially out of Israel. Engineering and a chunk of production stays where the talent is, and the region remains a high-risk operating environment.

• Tight float volatility. Limited paper amplifies upside when momentum is good. It can also amplify downside when sentiment turns.

Our view

Years ago, Dekel Keisar looked at the defence industry and bet against everything it stood for.

Every major player was building bigger, more expensive flying platforms. Multi-million dollar drones with multi-year delivery schedules. Dekel thought the future was the opposite. Drones you could build by the thousand.

In 2026, that’s the type of war being fought in Ukraine. That’s the procurement decision the Pentagon just made. That’s the volume problem every Western military is now staring at.

Dekel built KTK to supply the future he saw coming. The future has arrived.

KTK lists today at $28 million. Doing more than $5 million in revenue, growing at triple digits, customers running $2.5 billion in active drone contracts, and three directors who’ve each been inside an ASX drone story that became a serious one.

Most ASX listings ask the market to believe in something that might happen. KTK is asking the market to look at what’s already happening, and price it.

KTK rings the bell this morning at 20 cents. Wheels up.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (“Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 500,000 KTK shares at the time of publishing this article. Equities Club has been engaged by KTK at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

Evion Group (ASX: EVG) joined on Tuesday and ripped more than 60% the same day, on the second-highest volume trading day in the company’s history.

The rest of the portfolio kept moving while we were preparing this one. Drills mobilising in NSW, a CEO in London, and a serious manufacturing deal signed in Israel.

Meanwhile, copper is back near record highs. TSMC predicts the global chip market hits US$1.5 trillion by 2030. And Tuesday's Federal Budget had something real for critical minerals, plus a few CGT proposals worth paying attention to.

Here's what caught our eye:

• Why EVG ripped after we added it on Tuesday

• AI1’s quiet move toward an actual manufacturing partner

• TSMC’s US$1.5 trillion call and what it means for AI1’s graphene work

• Drills about to turn at Exultant Mining’s Balerion project

• Fortuna takes the rutile story to London

• Copper roars back and the juniors riding it

• What the Federal Budget actually means for small-caps

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EVG Explodes Higher After Portfolio Addition

Evion Group (ASX: EVG) joined the portfolio Tuesday morning and was up more than 60% by the close, on the second-biggest trading day in the company’s history. It cooled later in the week but still finished up 30%.

The fluorspar story is what pulled us in.

EVG owns the Carp project in Nevada, a historic US producer that delivered around 44,900 tonnes at 69% CaF₂ before it shut. Modern sampling is coming back above that historic average, and the company has expanded its claims around the original workings.

Most investors have never thought about fluorspar. Fair enough. It quietly underpins a big chunk of modern industry: hydrofluoric acid, lithium-ion battery electrolytes, semiconductor manufacturing, refrigerants and uranium enrichment all rely on it. China controls global supply, and the US imports effectively all of it.

A historic US fluorspar project lands directly in the middle of that scramble for non-China supply.

Then there’s the graphite side.

EVG’s Maniry graphite project in Madagascar is working through permitting, with the technical assessment signed off and the mining permit in the final stretch. Maniry sits under the EU Critical Raw Materials framework, which puts European customers on the table.

The Indian graphite processing operation is already throwing off cash, with shipments running into international markets right now.

EVG sits on revenue today out of India, a permitted project on deck in Madagascar, and a US fluorspar asset that lines up with where the political wind is blowing.

The share price sits at a mere 4.8c, and the company is valued just over $30 million with about $8 million in cash.

We expect EVG to continue to build momentum in the coming weeks with a stead news flow and will be reporting on everything to our subscribers.

Find our full breakdown of why we added EVG to our portfolio here.

AI1 Keeps Building With A Serious Partner

Adisyn (ASX: AI1) signed an MOU on Monday that changes the shape of its drone stealth program.

The partner is Raval A.C.S, one of Israel’s biggest plastics groups. Last year Raval did €201 million in revenue, with an order backlog of €1.243 billion.

Their customer list reads Volkswagen, BMW, Mercedes, GM, Porsche. Five of the toughest customers in manufacturing to win, and harder again to keep, and Raval has all of them.

AI1’s subsidiary 2D Radar Absorbers will co-develop graphene-enhanced injection-moulded parts for radar absorption in drones and UAVs.

Development happens on Raval’s serial production machines from day one. The parts coming out of R&D are already manufacturable, and the path from prototype to qualified volume production running in months rather than years.

The structure points toward a 50:50 joint venture for manufacturing in Israel, with 2D Radar earning a royalty on gross JV revenues for licensing its radar absorption technology. Definitive agreements are targeted within 180 days.

Every new materials story on the ASX runs into the same brick wall when defence customers turn up to look at it. Can you actually make this at scale, in a real factory, to the tolerances we need?

Many of them never answer that question. AI1 just did, by signing up a manufacturer who already builds parts for five of the biggest car companies in the world.

Israel and the US are scaling drone manufacturing capacity aggressively right now, and defence buyers are turning to automotive-grade plastics manufacturers because the volumes and accreditation already match.

And one detail in the fine print matters more than people might catch. The Tel Aviv University licence underpinning 2D Radar is worldwide. Raval's exclusivity covers Israel and nothing else. The same technology can sit inside a different partnership in Europe, the US, anywhere else AI1 wants to take it. They've signed the manufacturer, but not given away the asset.

And two carmakers on Raval’s customer list have also been in the news this week.

Mercedes-Benz’s CEO told the Wall Street Journal on Friday the carmaker is “willing” to move into defence production, saying it could be a “growing niche”.

Volkswagen is in talks to convert one of its German plants from car production to missile-defence manufacturing for an Israeli defence group.

The line between making cars and making defence equipment is thinner than it was a year ago.

AI1 just signed the manufacturer sitting right where that line runs.

Find our full breakdown on their recent announcement here.

What TSMC’s US$1.5 Trillion Call Means for AI1

TSMC believes the global semiconductor market clears US$1.5 trillion by 2030.

When the company manufacturing roughly 90% of the world’s most advanced chips, TSMC, starts talking about where the semiconductor market is heading, investors should probably pay attention.

AI and high-performance computing alone are expected to make up 55% of that.

And the chokepoint inside every next-generation AI chip is the interconnects.

The copper wiring that ties billions of transistors together on a chip is breaking down at modern speeds. It overheats and slows signals as chips shrink and clock speeds climb. The next generation of AI chips can’t get past this on copper alone.

AI1's atomic-layer-deposition work targets exactly that. They're growing graphene directly on the wafer to either improve or replace the copper, in a process that fits with how chips are already manufactured.

If even a piece of that lands, AI1 sits inside a market the world's biggest chip company has just put a US$1.5 trillion price tag on.

There's a long way to go yet, but the short list of ASX small-caps with that kind of optionality is why it sits in our portfolio.

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Drills About to Turn at Exultant Mining

The rigs should be spinning this weekend. Always a sentence we love to write.

Exultant Mining (ASX: 10X) put out a fresh corporate presentation this week, with mobilisation and site prep at Balerion already underway. The first hole turns over the weekend.

A formal market announcement is the usual next step, and we’d expect that to land in the coming week once the first hole is underway.

The drill program has been months in the making and these are the moments that make us love the small-cap game.

Chairman Brett Grosvenor spent last week adding to his position through on-market purchases. Directors buying ahead of drilling reads as confidence in what they may find.

10X has around $3.8 million in cash from the March quarter, with an enterprise value sitting closer to $3.5 million. For a company starting a drill program across multiple high-priority targets inside the renowned Lachlan Fold Belt, that’s tiny.

Old workings at Balerion produced intercepts of 4.25% copper, 1270g/t silver, 22% zinc, 11.6% lead and 2.29g/t gold.

Recent geophysics has flagged multiple low-resistivity and chargeability targets sitting next to, and in some cases directly underneath, those historic high-grade intercepts.

The strongest targets were never drilled by previous campaigns.

Whether the rigs find what the geophysics suggests is the open question we’ll soon have an answer to.

Fortuna Takes the Rutile Story to London

Fortuna Metals (ASX: FUN) flew its rutile story into London this week, with CEO Tom Langley at the 121 Mining Investment Conference with a fresh corporate presentation in hand.

London 121 is one of the bigger meeting points on the mining calendar. Around 75 companies, hundreds of qualified investors, and a format that produces thousands of one-on-one meetings across two days. It’s basically project teams sitting across from the people who allocate capital.

FUN walks in with the Mkanda rutile project in Malawi, sitting roughly 20km south of Sovereign Metals’ Kasiya discovery on the same geology. The updated presentation put an exploration target on Mkanda of 180 to 240 million tonnes at 0.86 to 1.0% rutile from shallow depths.

Rutile is the premium feedstock for titanium production, and titanium demand is firming across aerospace and defence. Humanoid robotics is adding a fresh angle, with Tesla and others now talking about production at scale.

A meaningful chunk of global rutile supply runs through a small number of producers in a small number of countries. Western buyers chasing allied supply have been working through their options for a while now.

A small-cap with a credible rutile story, on the same belt as a Rio-backed discovery, walking into a room full of institutions hunting for exactly that kind of name.

Pitt Street Research dropped a note on Fortuna this week. They’re calling the maiden JORC resource the milestone that converts FUN from explorer to resource-backed junior, with H2 2026 the target.

Pitt Street is reading FUN the same way we have been.

The weeks ahead are worth following.

Copper Roars Back as Junior Explorers Circle

Is copper back?

The price climbed roughly 7% this week before closing flat, but now sits up around 11% year-to-date, pushing back toward record territory.

Supply tightness, Chinese demand and the global electrification build are all pulling in the same direction at the same time.

BHP’s copper pivot is starting to look like the right call as the major leans further into copper exposure. The metal also brushed past Middle East volatility this month without flinching, which tells you something about how tight the market reads underlying supply.

The supply story is the engine as the world needs vast amounts of copper to electrify everything, build out AI data centres, ramp up defence manufacturing and keep grids upright. Meaningful new discoveries keep getting rarer and harder to develop.

When copper moves like this, the market eventually hunts further down the curve. Juniors with real ground and drills already turning sit at the front of that queue, especially the ones already throwing up early results.

What the Federal Budget Actually Means for Small-Caps

Tuesday’s Federal Budget got a fortnight’s worth of takes in 48 hours.

Most of them landed on the proposed CGT change. The 50% discount goes, replaced by cost-base indexation plus a 30% minimum tax on net capital gains, from 1 July 2027 if it passes.

Our take is that capital follows good companies. A multi-bagger is still a multi-bagger, even after the tax bill.

Then there's the critical minerals piece that caught our eye.

The new Critical Minerals Reserve pulls $1 billion from the existing $5 billion Critical Minerals Facility, with another $150 million set aside for selective stockpiling.

Canberra keeps signalling it wants Australia to do more than dig and ship, and the funding to back it is still flowing.

The companies with real projects and a sensible development pathway will feel it. The ones slapping “critical minerals” onto the PowerPoint will keep getting ignored.

At Equities Club, our approach stays the same. We are active investors, always looking for the best opportunity. We back companies where the project and the people both stack up, after they’ve been through our own filter. Most don’t make it.

Good projects keep finding capital, especially where the world is actively short of new supply. Weak stories get ignored faster than before.

The Week Ahead

The catalysts keep coming this week. The first Balerion results for 10X land in the weeks ahead. AI1 has a six-month clock to firm definitive agreements with Raval. The London 121 meetings tend to surface follow-throughs a couple of weeks later.

A lot of small-cap work is invisible. The site visits, the management calls, the months between deciding a name is worth covering and adding it to the portfolio. The next few weeks are where the visible part lives.

Till next week.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (”Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 1,554,000 FUN shares, 2,083,333 MRD performance rights, 900,000 AI1 performance rights, 200,000 10X shares, 4,500,000 EVG shares at the time of publishing this article. Equities Club has been engaged by FUN, AI1, MRD, 10X and EVG at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

In January, the Pentagon handed US$169 million to the only permitted producer left on American soil.

Without fluorspar, the modern world stops working. Lithium-ion batteries. Semiconductor chips. Refrigerants. Jet engine alloys. Uranium enrichment. None of it gets made at scale.

China produces 60% of the world’s supply. The US imports 100%.

Graphite is a similar story. It’s the largest raw material in every EV battery on the planet. The US imports 70% of its supply, and nearly all the battery-grade material comes from Chinese-controlled plants.

As of this week, one ASX-listed company has active projects in both.

Meet Evion Group (ASX: EVG), our latest portfolio addition.

EVG just signed a binding option for 100% of the Carp Fluorspar Project in Nevada, the world’s number one ranked mining jurisdiction. The ground has historic US production behind it, modern sampling has come back strong, and it sits inside a US state already home to plenty of working ASX miners.

It’s the profile Washington is now writing nine-figure cheques for.

In Madagascar, EVG’s flagship graphite project is weeks away from its mining permit. The technical work is signed off. The licensing body has been told to push the paperwork through.

EVG’s Indian joint venture, shipped its first major US order in December: A$1.5 million of expandable graphite to a buyer that needs non-Chinese supply. A second order has followed, with management flagging more soon.

Three legs across three continents, with no Chinese partners anywhere in the chain. The graphite project in Madagascar, the processing plant in India, and now the fluorspar asset in the United States.

Two of the most strategic minerals on the planet, sitting under one ASX ticker.

At 3.7 cents, EVG trades on a $25 million market cap with $8 million in the bank to deliver on all of it.

Let’s dig in.

Why Fluorspar Matters

Most people who’ve heard of fluorspar couldn’t tell you what it does.

That’s a problem, because there’s a decent argument that no industrial mineral on the planet is doing more work right now.

Fluorspar is a calcium fluoride mineral. Refine the high-grade stuff, add water, and you get hydrofluoric acid.

Hydrofluoric acid is the starting point for an entire branch of industrial chemistry that almost everything modern depends on.

Lithium-ion batteries are built around an electrolyte salt called LiPF₆, made with fluorine, sourced from fluorspar. Without it, the modern battery doesn’t exist.

Every advanced semiconductor chip is etched and cleaned with fluorine-based chemistry. NVIDIA's latest AI chips, the silicon inside an iPhone, the processor in a car's brake controller, all made using fluorine.

Enriched uranium runs on uranium hexafluoride. The “hexafluoride” is six fluorine atoms.

Refrigerants, jet engines, pharmaceuticals, Teflon. The list goes on. There’s no commercially scalable lithium-ion chemistry without fluorine, and no fluorine without fluorspar.

By 2035, industry forecasts have global demand running 40% to 70% above production capacity. Acidspar (the high-grade material) currently trades between US$450 and US$650 a tonne.

Supply has nowhere to go in the short term, and demand is being driven by the four hardest-to-replace use cases on the planet: batteries, chips, nuclear and defence.

That’s the gap EVG has just stepped into.

The Nevada Deal

In the late 1960s, trucks rolled out of a series of open pits 140km northeast of Las Vegas loaded with high-grade fluorspar bound for California.

The destination was Kaiser Steel Corporation, the west coast's biggest steelmaker at the time and one of the industrial heavyweights of America.

44,900 tonnes came out of the ground at an average grade of 69% CaF₂, crushed and shipped without any further processing.

Production stopped in 1971 when cheap imports flooded the US market and made small American producers uneconomic.

The rock didn't run out. The market just walked away from US fluorspar entirely.

This is the ground EVG has just secured.

The project is called Carp, and it sits in Lincoln County about 140km northeast of Las Vegas.

Nevada is the world’s number one ranked mining jurisdiction by the Fraser Institute, and Lincoln County itself has hosted gold, silver and industrial mineral operations for over a century.

Plenty of ASX names are already working in the state, so the regulatory pathways and contractor networks are well understood.

EVG has signed a binding option agreement with Globex Nevada Inc. for 100% of the project. The structure is light upfront with staged payments tied to milestones over the next three to four years.

Around the historic mine, EVG has also staked 45 adjacent unpatented claims, materially expanding the project footprint beyond the original ground.

A 2024 surface program across the project returned grades up to 88.15% CaF₂. Fourteen of 25 samples came back between 49.8% and 88.15%. The widest stretch was 5 metres at over 78% CaF₂ in the West pit.

There are two things to take from that.

At 69%, Carp historically made money. That's metspar grade, sold straight to steelmakers as a flux. The original operation didn't need to upgrade the rock at all, and the metspar market is still alive today.

The modern sampling is coming back much stronger. Samples hitting 88% sit a long way above the historic grade, and they're heading toward the acidspar threshold (97%+) where the real money lives.

Acidspar is the gateway to batteries, chips, refrigerants and uranium enrichment.

The geologist who ran the work also noted the analytical method wasn’t calibrated to high-grade fluorspar standards, so actual grades likely sit higher than reported.

The path from metspar producer to acidspar producer isn’t automatic, and that’s the work EVG has to do from here.

Rock chips and channel samples are selectively taken from the best-looking material on the ground and don’t represent bulk grade. They need to be confirmed by systematic drilling and metallurgical testwork before anyone gets too far ahead of the story.

The floor on Carp is the same business Kaiser Steel was buying in 1968, in a market that hasn’t gone away.

The ceiling is a fluorspar feedstock for the modern battery and semiconductor supply chain.

Both stories are in play.

Five Reasons We’re Backing Evion Group

1. Two Critical Minerals, One Stock

EVG is the only ASX-listed company with active projects in both graphite and fluorspar.

Both minerals appear on the US, EU, Australian, Canadian and Japanese critical minerals lists.

China dominates the production and processing of both. The US imports nearly 100% of its fluorspar and roughly 70% of its graphite (and almost all of its battery-grade graphite).

Western buyers are scrambling for non-Chinese alternatives, and the policy money following them runs to tens of billions.

Most ASX critical minerals stories give you one shot at one commodity. EVG gives you two, across three continents, with no Chinese partners in the chain.

If one of these legs rerates the way comparable single-commodity plays have, the $25 million market cap looks too cheap.

If both rerate, EVG is a different company at a different share price.

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2. The US Cheque Book Is Already Open for Fluorspar

We hit on this earlier, but it bears repeating.

In January 2026, the US Department of Defense awarded a US$169 million fluorspar supply contract to Ares Strategic Mining, for its Lost Sheep mine in Utah.

The deal can scale to US$250 million over five years. Ares is the only fully permitted fluorspar mine in the United States, and the company has been restarting production specifically to meet this contract.

One mine, one contract, US$169 million from the Pentagon up front.

That’s the most direct comparable available for what a US-based fluorspar developer can attract.

Behind that one contract sits a much broader US policy push:

• FAST-41 fast-tracks federal permitting for critical mineral projects

• Project Vault, launched in February, sets up a US$12 billion strategic mineral stockpile

• The Defense Production Act funds domestic processing and manufacturing capacity directly

• The DOE Loan Programs Office is sitting on hundreds of billions of dollars of authority for critical mineral projects

• EXIM, DFC, CHIPS Act funding for semiconductor inputs, and the FORGE program coordinating supply across 54 allied countries are all backing projects in the profile EVG has just acquired

All of it pointed at moving critical minerals supply out of Chinese hands.

For EVG, the Carp asset sits on BLM (Bureau of Land Management) public land, outside any conservation or wilderness area, in the world’s number one ranked mining jurisdiction.

That puts it inside the US funding architecture from day one.

The path to a meaningful US contract or grant on a fluorspar asset is well within reach for a 3.7c stock. The job from here is execution.

3. Maniry Is A Permit Away from Production

Madagascar sits on one of the biggest graphite endowments outside China, at grades most western producers couldn't dream of.

Maniry is EVG’s flagship project there. The team has been chasing a mining permit for years, and the asset has been the quiet hand behind the share price.

That’s about to change.

Maniry holds Strategic Project status under the EU's Critical Raw Materials Act. In plain English, that means Brussels has formally backed the project as part of Europe's plan to build a non-Chinese battery supply chain.

The designation unlocks EU grants, project finance, and preferred offtake partners. Maniry is the only graphite project in Africa carrying it.

The Definitive Feasibility Study, completed in 2022, has Maniry producing 60,000 tonnes of graphite concentrate per year for 21 years, with a pre-tax net present value of US$263 million.

In February, the Madagascar Mines Ministry confirmed EVG’s application meets all substantive requirements of the country’s new mining code.

The technical assessment is complete. The Ministry has formally directed the Mining Cadastre (the body that issues the permits) to process the conversion from exploration to exploitation permit (a mining permit).

When the permit lands, a few things happen at once. Offtake negotiations open. Construction planning starts. A €3 million EU grant EVG has been working toward gets unlocked.

The company is also in advanced talks with the European Investment Bank and KfW Development Bank on project financing. Both are weighing in for the same reason the EU designation exists in the first place.

The EU has separately committed over US$100 million to Madagascar for infrastructure, healthcare, and integration of local resources into global supply chains.

That’s the political backdrop EVG is operating in.

When the permit lands, EVG stops being an explorer with an asset and starts being a developer with a mine to build.

4. The India JV Is Already Generating Cash

This is the piece that gets overlooked. We did a double-take when we got to it.

EVG runs a 50/50 joint venture with Indian operator Metachem Manufacturing, called Panthera Graphite Technologies. The two operate an expandable graphite plant near Pune, already producing and selling product into the US, Europe and Asia.

The plant started shipping in March 2025. Around 120 tonnes went out the door in the March 2026 quarter alone.

Expandable graphite is a higher-margin specialty product. It goes into fire retardants, gaskets, thermal management, defence applications, and increasingly into batteries.

Very few non-Chinese producers operate at scale, and EVG is the only Australian-listed one.

The first major US order landed in December 2025 at A$1.5 million. A second sales order has since followed, with management flagging further orders in the short term.

US buyers are chasing non-Chinese supply, and the Panthera JV is one of the few places they can get it.

Stage 2 upgrades are underway to lift annual capacity to 4,000-4,500 tonnes. At current pricing, that's roughly A$18 to A$20 million in annual sales from the plant, with EVG entitled to half through its stake.

The modifications wrap up this quarter, with materially higher production rates from the June quarter on.

Then there's the IRA angle. Graphite processed by a non-Chinese entity in India and sold to a US battery maker is FEOC-compliant under the Inflation Reduction Act.

FEOC means "Foreign Entity of Concern", and getting around it is worth up to US$7,500 per vehicle in tax credits for the US carmaker buying the material.

Buyers chasing that credit are the same buyers filling Panthera’s order book right now.

For a junior critical minerals company, having real revenue, a growing order book, and a structural tax advantage in one of the most strategic commodities on the planet is extremely rare.

5. Tight Setup, Fully Funded

Alongside the Carp announcement, EVG raised A$6 million at 3 cents per share through a two-tranche placement. Combined with existing cash, the company sits on roughly A$8 million.

That puts the enterprise value at around $17 million.

For $17 million you get:

• An EU-backed graphite project with a US$263 million pre-tax NPV from its 2022 DFS

• A revenue-generating expandable graphite JV in India, ramping to A$18-20 million in annual sales

• A US fluorspar asset with the same profile as the one that just landed a US$169 million Pentagon contract

The cash on hand takes Carp through verification work, pushes Maniry to permit and offtake, and funds Stage 2 at the India JV.

No trip back to the market in the short term, and no dilution event hanging over holders.

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Upcoming Catalysts

Every portfolio addition has to clear the same bar for us: a potential steady stream of news to keep the momentum going. EVG clears it comfortably.

And the next twelve months are loaded with potential share price catalysts:

• Maniry mining permit issued in Madagascar

• €3 million EU grant unlocked after the permit lands

• Stage 2 commissioning at the Panthera JV, lifting production and margins

• Confirmation sampling at Carp to verify the 2024 surface results

• Drill permitting at Carp ahead of maiden drilling

• Maiden drill program at Carp later in the year

• Section 232 critical minerals trade decision (covering both graphite and fluorspar), deadline 13 July 2026

• Further US sales orders through Panthera as the order book fills up

That’s the beauty of EVG. The company isn’t reliant on one asset or one commodity to generate news flow. Three legs, three jurisdictions, three independent catalyst paths.

Every couple of weeks should bring a discrete news event capable of moving a 3.7-cent share price.

Risks

As always, none of this is risk-free.

Madagascar permits have come close to issuance before, and timelines in-country can slip. The Mines Ministry has done the technical work and the political backdrop is supportive, but until the paperwork is signed, it isn't signed.

On the fluorspar side, Mongolian production has been ramping fast to fill gaps left by Chinese supply tightening. The flip side is that US-produced fluorspar typically commands a premium to Mongolian or Mexican material, and Washington has made it clear it wants domestic supply specifically.

Carp is also still option-stage. The deferred payments and exploration commitments stretch out over three to four years, and the option only converts to full ownership once those milestones are hit.

Surface samples are not drill results. Carp still has to be drilled and tested before the bigger numbers in this article come into reach. That's the work EVG has just started.

The Bottom Line

For 35 years, the West outsourced its critical minerals problem to China. It worked, right up until it didn’t.

The country that supplied the world’s fluorspar, processed the world’s graphite, and the country every Western government is now trying to detach from, is all the same country.

Washington has spent two years and a stack of legislation and Trump Truth Social posts trying to unwind it. Brussels has stamped graphite projects as strategically essential. Canberra has written both fluorspar and graphite into the national reserve.

Underneath all of that policy, somebody has to actually own the mines, run the plants, and ship the product.

EVG owns a graphite project in Madagascar with Europe behind it, a processing plant in India already shipping into the US tax credit that exists for exactly this reason, and a fluorspar asset in Nevada in the shape of the one the Pentagon just funded.

From here it’s the company’s job to deliver.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (“Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 4,500,000 EVG shares at the time of publishing this article. Equities Club has been engaged by EVG at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

A critical mineral story in a tier-one jurisdiction, in a corner of the market where supply keeps tightening and the West is scrambling to rebuild.

What caught our eye:

• An asset that’s produced before

• High-grade samples on surface

• Demand pulling from steel, batteries, defence and semis

• A team building something bigger than just one project

We’re holders. The full breakdown drops tomorrow before market open.

Set your alarm.

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The partner is Raval A.C.S. Ltd, parent of Arkal Automotive.

Raval makes parts for all the cars you’d recognise. BMW, Mercedes, Porsche, Volkswagen, GM and Audi all buy directly from them.

The big global parts companies that supply those carmakers, names like Magna, Brose and Plastic Omnium, also sit on Raval’s customer list.

Today they signed up to manufacture AI1’s stealth drone parts.

In short, AI1 brings the graphene material that hides drones from radar, and Raval moulds it into the actual drone parts at production scale.

The agreement runs for 18 months as a joint development program, with a clear pathway to a 50/50 manufacturing joint venture if the technical and commercial milestones land.

A €1.2 Billion Order Book Behind the Deal

Raval’s scale is the part most retail readers will skim past in the announcement.

Their numbers from last year:

• ~€201 million in revenue.

• ~€33 million in EBITDA.

• A €1.243 billion order book of work already signed up by their customers.

• 1,220 staff across 11 facilities globally.

Raval is a serious global manufacturer choosing to put its production lines and engineering depth behind AI1’s drone tech.

A manufacturer of that scale signing up to a partnership like this is a serious vote of confidence.

The Real Test for ASX Defence Tech

The companies that win in defence tech share one thing in common. They’ve got a path from the lab bench to the factory floor.

A company spends years developing a material in a university partnership. They get a lab result. Then comes the hard part.

They have to find a manufacturer who can take that lab result and turn it into thousands of identical parts, to the tolerances a defence customer demands.

Lab partners and production partners are usually two different organisations. Two different sets of equipment. Two different quality systems. Two different ways of working.

Bridging them takes years. Sometimes it never happens at all.

Raval is both partners in one.

Most lab-to-factory transitions involve months of redesign. The lab makes a part one way, the factory makes parts a different way, and engineers spend a long time bridging the two.

Raval skips that.

Development of AI1’s parts starts on the same machines that will eventually mass-produce them. The factory tooling, the materials database, the production process, all of it is being used from the very first prototype.

By the time the part works in testing, it’s already designed to be made at volume.

Defence customers needing drones in the field yesterday don’t have time for suppliers still figuring out how to mass-produce.

Why Automotive Credentials Cross Over to Defence

Cars get made to standards most things on the planet don’t.

A bracket holding your seatbelt in place that fails in a 60kmh crash can kill people.

The certifications behind global automotive supply exist because the consequences of a part failing in the field are catastrophic, and the volumes are too big to inspect every unit.

Defence procurement officers know this.

The auto industry’s quality bar is higher than what most defence contracts require. A supplier already approved to make parts for BMW and Mercedes is, by definition, capable of making parts for the Israeli Ministry of Defense.

Raval has the full stack of automotive quality and security accreditations across all of its global facilities.

Raval also runs its own accredited testing lab at Arkal's plant in northern Israel. Defence customers can trust the test data that comes out of it without having to retest the parts themselves.

For AI1, plugging into Raval means walking into a defence procurement meeting with a manufacturing partner whose audit history is already a known quantity.

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This Is Already Happening in Germany

The AI1/Raval deal sits inside a much bigger global shift.

Last week, Israeli defence company Rafael, one of the main partners in Iron Dome, Arrow and David’s Sling, signed a letter of intent to acquire a Volkswagen plant in Germany.

The plant, which employs 2,300 people, is being repurposed to manufacture parts for Iron Dome interceptor missiles. The deal is backed by the German government.

Rafael going into a VW plant in Germany. AI1 going into Raval’s production lines in Israel.

It’s the same shift, with a different scale. Israeli defence technology is moving directly onto automotive manufacturing capacity, because automotive plants have the precision tooling, the trained workforce and the quality systems that defence procurement officers need.

Where AI1 Sits Today

A quick recap for anyone catching up.

We told readers we’d added Adisyn to the Equities Club portfolio just over three weeks ago when it was at 6.8 cents. This morning it sits at 30c.

AI1 is a graphene technology company pointed at two enormous markets.

The first is chipmaking, where its low-temperature graphene process cleared a decade-old semiconductor roadblock the day we wrote about the company.

The second is drones, where the same graphene platform is being developed into a coating that effectively hides drones from radar.

On the drone side, the tech has already cut radar return from drones by 100 times in lab testing. A drone that used to read on radar like an F-35 fighter jet now reads like a bird. AI1’s 12-month research program is targeting 1,000 times, where the drone shows up looking more like an insect.

Inside the four trading days that followed the addition, AI1 cleared the chip industry milestone, signed the exclusive worldwide stealth drone licence with Tel Aviv University, and filled a $14 million placement cornerstoned by Meitav (Israel’s largest investment house, A$190 billion under management) and Regal Funds Management (A$20 billion under management).

Last week, retired Israeli Colonel Tamir Zimber, operational commander of Iron Dome, Arrow, David’s Sling and Patriot, was appointed as the first member of the advisory board for the drone subsidiary.

A couple of days later, AI1’s core graphene patent got the green light from the US Patent Office, giving the company a US legal wall around the technology.

Today, the manufacturing partnership.

That’s a meaningful month for a company sitting at a $57 million market cap less than four weeks ago.

What the Deal Actually Says

The agreement is built in two stages.

Stage one is an 18-month joint development program. Each company funds its own work. Raval handles the plastics, the moulds and the mechanical testing using its automotive-grade tooling and materials database. AI1 leads the graphene side and the radar testing alongside Tel Aviv University.

Two milestones sit inside that 18 months.

At the 12-month mark, the parties need to show real technical progress. The announcement defines that as successful radar absorption testing against agreed targets, completion of the agreed workplan, or a customer asking for a prototype.

At the 18-month mark, they need to formally declare the collaboration commercially viable.

The hard contracts that lock the JV in are targeted for the 180-day mark from today.

Stage two is the joint venture itself. If the milestones land, AI1 and Raval form a 50/50 company to manufacture and supply graphene-enhanced parts into the drone and UAV market.

AI1's drone subsidiary, 2D Radar Absorbers, licenses the technology into the JV in exchange for a cut of the JV's gross revenues. Tel Aviv University's tech transfer arm Ramot owns 19% of that subsidiary. AI1 owns the rest.

The JV has manufacturing exclusivity inside Israel only. Every other jurisdiction stays open for AI1 to commercialise separately.

That’s a good outcome. Israel is Raval’s home market, so giving them local exclusivity makes sense.

Outside Israel, AI1 keeps the door open for separate manufacturing deals in the US, Europe, Australia and anywhere else the technology gets pulled into.

Free Money on the Table

Inside the announcement is a path to funding that doesn’t cost AI1 any equity.

Each party covers its own costs through the development phase. AI1 also has the option to apply for grants from MAFAT, the R&D arm of the Israeli Ministry of Defense, or the Israeli Innovation Authority.

If approved, that money can flow into Raval’s development costs as well.

For an ASX small-cap, government grant funding is the cleanest capital available.

A grant approval at any point in the next 12 months would be its own news event.

What We’re Watching From Here

Three things over the next 12 to 18 months on the manufacturing side:

• Hard contracts inside 180 days. The MOU is a binding intent to collaborate. The full JV paperwork comes next. Watch the timing.

• Israeli government grant funding. Capital flowing in that doesn’t cost AI1 shareholders any equity would be a real positive.

• First customer prototype request. The agreement explicitly names this as a benchmark for technical progress at the 12-month mark. A customer asking for a prototype is the moment the technology stops being a science project and starts being a product.

The previous AI1 milestones have built scientific credibility, legal protection and access to the Israeli defence customer base.

This one builds the factory.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (“Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 900,000 performance rights at the time of publishing this article. Equities Club has been engaged by AI1 at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

While the big end of town got sold off, our small-cap portfolio kept punching above its weight.

Colonel Tamir Zimber spent his career deciding when Iron Dome interceptors left the launcher. This week he joined Adisyn’s advisory board.

We also had visible sulphides on a first hole back in Mongolia, drills close to spinning up at Balerion, fresh gravity targets across Grass Patch, and another mineral sands veteran joining Fortuna’s team.

It was a bit of a tale of two markets, really.

Gold pushed back toward US$4,730 an ounce, Gillon McLachlan and his fellow Tabcorp punters watched $500 million walk out the door, and a $10.7 billion merger created a new ASX gold heavyweight.

Plenty going on in our portfolio and beyond. Let’s get to it.

What caught our eye this week:

• Fund managers think a peace deal could send the ASX back toward record highs

• AI1 lands a top-shelf advisory board appointment and locks in US patent protection

• Exultant Mining set to drill Balerion with high-grade historical hits back in focus

• Mount Ridley adds new targets as it looks to expand Grass Patch

• Fortuna adds more expertise with a titanium specialist

• AZ9 is back drilling in Mongolia and immediately hits visible sulphides at Red Hill

• Tabcorp punters cop it as more than $500 million is wiped overnight

• A new ASX gold heavyweight emerges as consolidation sweeps through the sector

The Peace Trade is Building

A growing number of fund managers reckon the ASX snaps back to record highs the moment the US and Iran lock in a real ceasefire.

It’s a sentiment we share.

Before the conflict escalated, global markets were already grinding higher on the back of AI spending and a wall of liquidity flowing into equities.

Oil spikes and inflation fears since then have dragged sentiment lower, particularly across cyclicals.

The AFR spoke to several managers who reckon the ASX has trailed overseas markets all year and could quickly return toward record levels on a lasting ceasefire.

Their theory is that lower oil eases inflation, easing inflation lets central banks back off, and once rates stop being the market's biggest fear, money rotates back into growth and risk assets fast.

Resources stand to do well in that scenario, particularly copper and gold producers.

For what it’s worth, we’re with the fundies on this one. The ASX has been holding its breath all year. The moment it can exhale, things tend to move fast.

AI1 Lands Iron Dome Pedigree and Locks In Its US Patent

Adisyn (ASX: AI1) couldn’t stop making news this week.

On Tuesday, the company appointed retired Israeli Air Defense Colonel Tamir Zimber to the advisory board of its stealth drone subsidiary.

Zimber spent more than two decades inside Israel’s air defence unit, the one that operates Iron Dome, Arrow, David’s Sling and Patriot.

Zimber ran the unit that operated the lot.

Defence procurement runs on relationships built over years, and Zimber has spent twenty of them inside the rooms where those calls get made.

His day job today is at Israel Aerospace Industries, where he runs air defence sales into India. India is IAI’s biggest single foreign customer, and one of the fastest-growing defence import markets on earth.

The advisory board is there to do one thing. Turn lab results into orders.

Two days later, the US patent office formally allowed AI1’s foundational graphene coating patent.

The patent covers the manufacturing method, the resulting graphene-coated product, and the devices built around it.

AI1 is the only company we can find that’s figured out how to grow continuous graphene at temperatures that don’t melt the chip.

The same patent extends to the stealth drone work happening inside the 2D Radar Absorbers subsidiary. It’s one piece of IP, with two enormous markets.

AI1 is now up over 340% since we first added them to our portfolio three weeks ago.

It’s the jewel in the portfolio right now, and the company keeps giving us reasons to say so.

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Exultant Nears Drill Start at Balerion

Exultant Mining (ASX: 10X) is just about ready to spin the drill bit at the newly renamed Balerion Prospect. Approvals are through and the 12-hole RC campaign is good to go.

With drills days from turning, this one is shaping as one of the biggest near-term catalysts in our portfolio, and we don’t think the market has quite clocked it yet.

The campaign is targeting multiple untested geophysical anomalies pulled from the company’s recent IP, gravity and resistivity surveys across a 900m-long copper-lead-zinc-silver-gold corridor.

Several holes are also targeting down-dip extensions of historical high-grade hits, including 4.4m at 342.7g/t silver, 4% lead and 1.1% copper, alongside another intercept returning 22% zinc and 11.6% lead.

At a market cap of around $6 million with the rig about to turn, this is exactly the setup we like. A funded drill program on ground that’s already produced mineable grades, with no need to raise. A few good holes and the conversation around 10X changes very quickly.

Mount Ridley Keeps Adding to Grass Patch

Mount Ridley Mines (ASX: MRD) keeps building scale around its Grass Patch rare earths, scandium and gallium system near Esperance, with new 3D gravity modelling pointing toward more potential beyond the current resource footprint.

The modelling tied mineralisation tightly to gravity highs, with fresh target zones now opening up across two large corridors that remain open along strike and at depth.

Translation: there's more here than what's already been counted, and the system isn't running out of room.

The shallow depth to fresh rock, estimated around 70-80 metres, matters if the resource base continues growing. Shallower mineralisation can materially improve future mining economics through lower strip ratios and simpler development pathways.

MRD continues strengthening its position in the heavy rare earths space, with the company working alongside Lawrence Livermore National Laboratory on metallurgical processing while still trading at roughly one-fifth the valuation of nearby peer Victory Metals (ASX: VTM), leaving plenty of room for the market to reassess the story if resource growth and downstream discussions continue progressing.

The location of the project keeps working in MRD’s favour too. It sits just 25km north of the deep-water Port of Esperance, giving it infrastructure advantages most critical mineral projects can only dream about.

Management hasn’t taken its foot off the pedal either. From exploration success to target refinement to early processing chats, all inside a short window.

The latest modelling says the system is bigger than what’s been counted, and nobody at Grass Patch is slowing down to admire it.

Fortuna Builds Out Its Commercial Team

Fortuna Metals (ASX: FUN) continued building out its technical and commercial team this week with the appointment of mineral sands marketing specialist Ian Hind, a figure with more than two decades of experience across Iluka, Kimberley Mineral Sands and Strandline Resources.

You don’t bring in a guy like that if you’re still trying to find the rocks. Fortuna is clearly thinking past exploration and toward what happens when the rutile actually needs to move.

Hind brings direct experience in titanium mineral sales, logistics, shipping and offtake, all areas that matter more as projects move closer toward feasibility.

It’s the latest high-profile appointment for FUN as the company continues building a credible team around the Mkanda rutile project in Malawi.

Drilling is also underway on tighter-spaced infill work ahead of a larger aircore program planned for June, targeting mineralisation down to around 20 metres.

Coherent rutile anomalies now stretch across roughly 53km², with higher-grade cores covering around 28km². Mkanda keeps getting bigger every time fresh data comes in, and Hind’s hire suggests Fortuna already knows where this is going.

AZ9 Starts Strong at Red Hill

Asian Battery Metals (ASX: AZ9) waited out the Mongolian winter to put a rig back on its newly renamed Red Hill copper-gold project, and the first hole back hit visible sulphides.

It has been a little while since the market last had a drilling update from AZ9, but the company has wasted very little time getting back into mineralisation.

The first completed hole intersected chalcopyrite and chalcopyrite-bornite across two massive sulphide intervals totalling 18.8 metres.

Management noted the changing copper mineralogy and increasing copper intensity may point toward a higher-grade copper zone developing toward the west-northwest of the system.

The hole also hit the targeted electromagnetic conductor pulled from earlier work, giving the team another early tick in the box for its geophysical targeting.

Assays are still pending, but visually the campaign has started strongly. With follow-up drilling continuing and the broader VMS system still largely underexplored, AZ9 looks to have regained momentum heading deeper into the 2026 field season.

Tabcorp Gets Hit By AUSTRAC

Gillon McLachlan was supposed to be at the Warrnambool Cup this week, deep in the box with the heavy hitters. Instead, he was on the phone in a boardroom, watching half a billion dollars walk out the door.

The company revealed AUSTRAC, Australia’s anti-money laundering and counter-terrorism financing regulator, had launched an enforcement investigation into Tabcorp’s AML and compliance controls.

The reaction was brutal, with more than $500 million wiped from Tabcorp’s value within hours and the market cap dropping from around $2.63 billion overnight.

The issue is cash. Tabcorp still has exposure to cash betting through pubs, clubs and tracks, which creates obvious monitoring headaches compared to purely digital wagering rivals.

Punters have long speculated on the ease of sending a photo of a winning TAB ticket for a mate to cash.

The AFR also noted Tabcorp had already been fined $45 million by AUSTRAC back in 2017.

There aren’t many CEOs as adept or well-connected as McLachlan. AUSTRAC sits at arm’s length from government, but the broader political mood around gambling has hardened, and his playbook is about to get a proper test.

The company says the investigation is early stage and all outcomes remain open, including no further action. But punters know how to read form. When the regulator’s circling, you back the bad news in early and check the result later.

Regis And Vault Build A Gold Giant

The gold space got another major merger this week, with Regis Resources (ASX: RRL) and Vault Minerals (ASX: VAU) agreeing to combine in a $10.7 billion deal that will create the third-largest gold producer on the ASX.

The combined business is expected to produce more than 700,000 ounces a year and control roughly 20.5 million ounces of gold resources alongside 6 million ounces of reserves spread across Australia and Canada.

This feels like another sign the Aussie gold sector is entering a new phase. With gold sitting at historically strong levels and producers throwing off huge cash flow, the majors are starting to realise scale matters more than ever.

A few years ago the game was all about finding ounces. Now it feels more like a land grab for processing infrastructure and regional dominance.

WA’s Goldfields in particular is starting to look like one giant consolidation battle. Any small-cap that makes a substantial discovery becomes a takeover target very quickly.

The Wrap

Plenty still to land in the next few weeks. Drills spinning up across the portfolio, assays still pending out of Mongolia, and infill work running ahead of Fortuna’s larger aircore program in June.

We’ll also be watching the federal budget closely this coming week, particularly anything that lands on critical minerals, defence spending, or resources tax settings. The detail tends to matter more than the headlines for small-caps.

Gold’s still firm, copper’s still tight, and the juniors are getting busy. Hard to ask for much more than that heading into a budget week.

Till next week.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (”Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 1,554,000 FUN shares, 2,083,333 MRD performance rights, 900,000 AI1 performance rights, 200,000 10X shares, 1,150,000 AZ9 shares at the time of publishing this article. Equities Club has been engaged by FUN, AI1, MRD, 10X and AZ9 at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

The patent protects the method of creating graphene-coated metal surfaces, the resulting product itself, and the devices that use it.

For AI1, it puts a US legal wall around technology targeting two major global industries.

The first is semiconductors, a trillion-dollar industry now scrambling to solve the physical limits of copper wiring inside AI chips. The second is defence and autonomous drones, where radar-absorbing materials and stealth technology are becoming increasingly valuable.

The patent allowance shifts AI1 from being a science project into a company now sitting in commercial conversations around licensing, partnerships and adoption.

Where AI1 Sits Today

A quick recap for anyone catching up.

We added AI1 to the Equities Club portfolio just over two weeks ago at 6.8 cents. Today it sits at 27.5c, a major run backed by major news flow, with plenty more ahead if the company continues executing.

AI1 is a graphene technology company pointed at two enormous markets.

The first is chipmaking, where its low-temperature graphene process cleared a decade-old semiconductor roadblock the day we wrote about the company.

The second is drones, where the same graphene platform is being developed into a coating that effectively hides drones from radar.

Inside the four trading days that followed, AI1 cleared the chip industry milestone, signed the exclusive worldwide stealth drone licence with Tel Aviv University, and filled a $14 million placement cornerstoned by Meitav (Israel’s largest investment house, A$190 billion under management) and Regal Funds Management (A$20 billion under management).

This week, retired Israeli Colonel Tamir Zimber, operational commander of Iron Dome, Arrow, David’s Sling and Patriot, was appointed as the first member of the advisory board for the drone subsidiary.

Today, the US patent allowance lands.

What “Allowed” Actually Means

A quick word on the language, because patent terminology can be slippery.

When the United States Patent and Trademark Office (USPTO) “allows” a patent, it has reviewed the application, satisfied itself that the technology is genuinely new and inventive, and decided it will be granted.

The patent process can take anywhere from 18-36 months to be assessed and approved. AI1 is far down that process and the expectation is final approval is one to three months away.

What’s left from here is largely paperwork. The examiner has effectively made the call, with the process now moving toward final sign-off and formal grant.

What the Patent Covers

Most patents protect either a method or a product. This one covers both, plus the devices that contain the product.

That is an important distinction.

• A method-only patent stops competitors from copying the way you make something.

• A product patent stops competitors from selling the thing itself, however they made it.

• A device patent stops them from selling the gadgets that use it.

AI1’s patent covers all three.

The technical side of the patent matters too.

AI1’s patent protects graphene coatings that are ultra-clean, highly consistent, tightly bonded to the metal underneath, and made without the contamination issues that have crippled competing graphene processes for years.

It also protects the low-temperature manufacturing process AI1 uses to build those graphene layers in conditions compatible with real semiconductor factories.

The chip industry has spent years knowing graphene could be the answer, but nobody could make it properly inside an actual chip production environment.

AI1’s patent is built around solving exactly that problem.

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Why These Numbers Matter to Chipmakers

A reminder of the problem AI1 is solving on the chip side.

Every advanced chip on the planet uses copper wiring to move electricity between transistors. It’s why the chip industry is a trillion dollar industry, and growing very quickly.

As chips have shrunk over the past decade, that copper wiring has shrunk with them.

It is now thin enough that resistance is climbing, signals are stalling, and AI workloads are wasting enormous amounts of electricity just pushing electrons through the wires.

The semiconductor industry has agreed for over a decade that graphene is the answer.

Imec, the Belgian research hub TSMC, Intel, Samsung (the latest trillion dollar company) and the rest of the major chipmakers use to figure out what’s next, has publicly named graphene as the most promising replacement.

The catch was always how to make it. Graphene normally needs about 1,000 degrees Celsius to grow. A real chip factory caps out at 450 degrees.

Anything hotter melts the chip.

AI1 is the only company we can find that has demonstrated a process to grow continuous graphene at temperatures that won’t melt the chip.

The patent now puts a US legal wall around exactly that.

The defect and coverage numbers inside the patent are where the value sits.

If the graphene layer is patchy or full of imperfections, it simply does not work properly inside a chip. AI1’s patent sits around the performance levels the semiconductor industry has been trying to reach for years.

That is what turns this from just another patent filing into something commercially valuable.

Why the US Patent Specifically

The US is the largest and most commercially significant patent jurisdiction in the world.

Three reasons that matters for AI1.

First, every major chip equipment company AI1 might one day license to or be acquired by: Applied Materials, Lam Research, KLA, is US-headquartered. A US patent is the one their lawyers will look at first.

Second, US courts are where the real money in patent enforcement gets decided. A US patent gives AI1 the option to sue infringers, block imports through the International Trade Commission, or use the threat of either to drive licensing deals.

Third, the CHIPS Act has put tens of billions of US government dollars behind onshoring chip manufacturing. TSMC’s Arizona fabs are getting US$6.6 billion. Micron US$6.17 billion. Samsung US$4.75 billion. Every fab built under that program is a fab that needs IP-cleared materials.

A US patent on a fab-compatible graphene process is exactly the kind of asset that fits inside that wave.

Why Method-Plus-Product Matters

Most chip industry patents only cover a method.

That’s a problem if your competitor figures out a different way to get to the same end product, because the method patent doesn’t stop them.

AI1’s patent covers the resulting graphene-coated metal product directly, regardless of how it was made.

Anyone producing graphene-coated metal surfaces that fall within the performance specs laid out in the patent now risks stepping into infringement territory inside the US.

That’s a much wider net than a method patent alone.

For a company that may one day license its technology to multiple customers, this is the structure that maximises what AI1 can charge.

The Bigger Defensibility Story

The patent is one layer. AI1’s announcement makes a point of flagging the rest.

Some of the most valuable elements of the technology include the chemistry of the molecular precursors, the operational know-how, the manufacturing tweaks built up over six years of lab work, will all stay as trade secrets rather than registered patents.

There’s a reason for that is once you patent something, the world can read exactly how it works. The clock starts ticking on your 20-year exclusivity, and after that anyone can use it.

Trade secrets don’t expire. They just need to stay secret.

The Coca-Cola formula has never been patented. Neither has KFC’s secret eleven herbs and spices, but then neither has the precise chemistry inside ASML’s chipmaking machines, the tools used to manufacture the world’s most advanced semiconductors.

The most defensible technology businesses on the planet run a blend of patents on the obvious stuff and trade secrets on the bits competitors most want to copy.

AI1 is now running that same playbook.

Drone Side: One Patent, Two Programs

The patent’s scope explicitly extends to advanced composite materials, including the work happening inside 2D Radar Absorbers Ltd, the subsidiary holding AI1’s stealth drone licence.

Same core technology. Different end market. One patent covers both.

AI1 has two shots at multi-billion dollar markets, this is the cleanest legal structure available, one piece of IP that protects two completely separate commercialisation paths.

What We’re Watching From Here

Three things over the next 12 months on the chip side of the business:

• Formal grant of the US patent. Allowance is the green light. Grant is the formal stamp. Usually a one-to-three month gap.

• Additional patent filings. The company has flagged it is “evaluating the extension of its intellectual property position through additional patent filings in relevant jurisdictions.” Expect more announcements as the global IP wall is built out.

• First commercial conversations on the chip side. The patent allowance gives AI1 something every prospective licensee or partner needs to see before they engage seriously: proven, enforceable IP in the world’s biggest market. Chairman Kevin Crofton spent 30 years inside the rooms where TSMC, Samsung and Intel pick what to adopt next. Those are the conversations the patent now opens up.

The chip industry has been watching graphene for over a decade.

AI1 just turned its lab work into a US legal asset.

General advice warning

The contents of this document are intended to provide general securities advice only and have been prepared without taking account of your objectives, financial situation or needs. Because of that you should, before taking any action to acquire or deal in, or follow a recommendation (if any) in respect of any of the financial products or information mentioned in this document, consulting your own investment advisor to consider whether that is appropriate having regard to your own objectives, financial situation and needs. If applicable, you should obtain the Product Disclosure Statement relating to the relevant financial product mentioned in this document (which contains full details of the terms and conditions of the relevant financial product) and consider it before making any decision about whether to acquire the financial product. Whilst the Equities Club Pty Ltd (”Equities Club”) believes information contained in this document is based on information which is believed to be reliable, its accuracy and completeness are not guaranteed and no warranty of accuracy or reliability is given or implied and no responsibility for any loss or damage arising in any way for any representation, act or omission is accepted by Equities Club or any officer, agent or employee of Equities Club or any related company.

Neither Equities Club, nor any of its directors, authorised representatives, employees, or agents, makes any representation or warranty as to the reliability, accuracy, or completeness, of this document or any advice. Nor do they accept any liability or responsibility arising in any way (including negligence) for errors in, or omissions from, this document or advice.

Disclosure

The directors, authorised representatives, employees and associated persons of Equities Club may have an interest in the financial products discussed in this document and they may earn brokerage, commissions, fees and advantages, pecuniary or otherwise, in connection with the making of a recommendation or dealing by a client in such financial products. Equities Club owns 900,000 performance rights at the time of publishing this article. Equities Club has been engaged by AI1 at the time of writing.

Confidentiality notice

The information contained in and accompanying this communication is strictly confidential and intended solely for the use of the intended recipient/s. The copyright in this communication belongs to Equities Club. If you are not the intended recipient of this communication please delete and destroy all copies immediately.

Equities Club Ltd (CAR No. 001308139) is a corporate authorised representative of ShareX Pty Ltd, Australian Financial Services License (AFSL) No 519872.

Today the company put the first name on the advisory board for the subsidiary that holds it.

The name is retired Colonel Tamir Zimber.

If you were drawing up a wishlist of who you’d want advising a company building radar-evading materials for drones, you’d start here.

Who is Tamir Zimber

Zimber spent more than two decades in the Israeli Air Defense Array, and retired as a Colonel.

The Air Defense Array is the unit inside the Israeli military that runs every system designed to shoot down anything coming through Israeli airspace. Rockets, drones, cruise missiles, ballistic missiles, the lot.

The role he retired from had him in operational command of every major Israeli air defence system at once - Iron Dome, Arrow, David's Sling, and Patriot.

Together these systems form the four-layer shield that has intercepted thousands of rockets, cruise missiles, drones and ballistic missiles over Israeli airspace for nearly two decades.

Iron Dome alone has logged over 5,000 interceptions at a a roughly 90% hit rate.

Zimber commanded the personnel, the readiness and the execution of the lot.

After the army he moved to Israel Aerospace Industries (IAI), Israel's largest defence company and a global top-tier exporter of UAVs, missiles, radars and air defence systems.

His title at IAI is Senior Director, Air Defense Systems (India). India is the largest single-country buyer of Israeli weapons in the world, and IAI's biggest foreign customer.

The role oversees multi-billion dollar programs and runs business development across government and military customers in one of the fastest-growing defence import markets on earth.

In other words: he sells advanced air defence systems to governments for a living.

It’s a pretty handy day job for a man now working with a company looking to commercialise its work on stealth material in drones.

Where AI1 Sits Today

A quick recap for anyone catching up. We announced we’d added Adisyn to the portfolio just over 2 weeks ago when it was 6.8 cents.

AI1 is a graphene technology company pointed at two enormous markets. The first is chipmaking, where its low-temperature graphene process cleared a decade-old semiconductor roadblock.

The second is drones, where the same graphene platform is being developed into a coating that effectively hides drones from radar.

Inside four trading days the company cleared the chip industry milestone, signed the exclusive worldwide stealth drone licence with Tel Aviv University, and filled a $14 million placement.

The book was cornerstoned by Meitav, Israel’s largest investment house with roughly A$190 billion under management, and Regal Funds Management with A$20 billion under management.

The share price ran from 6.8c to 20c across the week. Three of the biggest volume days in the company’s history landed in the same week, and roughly $110 million in market cap was added between Sunday and Friday. It’s now sitting at a very healthy 19.5c.

The stealth drone licence sits inside a subsidiary called 2D Radar Absorbers Ltd.

That’s the entity AI1 just appointed Zimber to advise.

Why This Hire Matters

Stealth materials live or die on one question: do they meet end-user requirements?

A graphene composite that performs in a Tel Aviv lab is interesting. A graphene composite that drops radar return at the exact frequencies a defence ministry’s procurement spec calls out is a contract.

Zimber has spent his career on the buy side of that equation. He knows which signature reduction targets matter, at which frequencies, against which threats, on which platforms.

He also knows the people writing the cheques.

AI1 chairman Kevin Crofton brings the semiconductor commercial network. MD Arye Kohavi brings the Israeli defence relationships and an ex-IDF Special Forces background. Professor Pavel Ginzburg at Tel Aviv University runs the radar physics.

Zimber's been the man on the other end of the phone for twenty years. Now he's on AI1's side of it.

What He’s Actually Doing

The release lays out the advisory board’s brief:

• Tell AI1 which radar-related work to prioritise

• Help translate lab results into specs that end-users will actually buy

• Open doors to defence contractors and government procurement offices

• Plug AI1 into global defence networks

• Lend credibility when AI1 walks into procurement meetings

That last point is worth backing over.

A pre-revenue ASX small-cap walks into a defence contractor with a graphene material, and the buyer's first question is, ‘Who's vouching for this?’.

A former Israeli air defence colonel currently running multi-billion dollar IAI programs is a serious answer.

The Bigger Picture Hasn’t Changed

The drone race is now a stealth race.

Military drone spending is forecast to triple from US$20.7 billion to US$66 billion by 2035. The global counter-UAS market is on track to grow from US$4.9 billion in 2025 to US$36 billion in the same window. Australia just put A$7 billion behind counter-drones over the next decade.

Every dollar going into radars to detect drones is a dollar putting pressure on drone-makers to find ways past those radars.

Now for the not so tech-savvy like us, here’s the part worth slowing down on.

Radar performance moves on a log scale. Every 10 decibels (dB) of radar signature reduction means a tenfold drop in what the radar picks up. So 20dB is 100 times less radar return. 30dB is 1,000 times less.

AI1 has already hit 20dB in lab testing at Tel Aviv University. The 12-month program now under way is targeting 30dB.

Getting from 20 to 30 looks like a small bump on paper. In radar physics, it’s a tenfold leap in stealth performance.

At 100 times less radar return (where AI1 are now), a quadcopter drone that used to read on radar like an F-35 fighter jet now reads like a bird. The radar operator spots the threat too late.

At 1,000 times, the drone shows up looking more like an insect, and gets through undetected.

The country that builds it first gets a lethal edge in the next decade of airborne warfare.

What We’re Watching From Here

Three things on the radar (so to speak) over the next 12 months:

• More advisory board appointments. Zimber is described as the first member. The release calls this “a further step in positioning the company to translate technical capability into commercial outcomes.” More names, particularly from Western primes or US procurement, would build that out.

• Lab results pushing toward 30dB. It’s the same milestone we flagged last time. This is the number that turns their lab work into customer conversations.

• First commercial engagements. Advisory board members open doors. The next signal is who walks through them.

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