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.

Subscribe now

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.

Subscribe now

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

  ---

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.

Subscribe now

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.

Subscribe now

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.

Subscribe now

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.

Subscribe now

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.

Subscribe now

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

Subscribe now

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.

Subscribe now

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.

Subscribe now

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.

Subscribe now

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.

Subscribe now

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.

Subscribe now

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.

Subscribe now

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.

Subscribe now

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.

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.

Subscribe now

The bank spent it answering for things that had nothing to do with the price of money or stocks, and by Friday the whole thing was coming apart at the seams.

We won’t dive into it but if you haven’t caught up on the story, wait until the kids leave the room.

Wall Street, as ever, providing the entertainment.

Closer to home, things were quieter. The ASX 200 finished the week roughly flat after another hotter-than-expected inflation number was shrugged off, and commodity prices held their ground while blue chips drifted through five sessions of indifference.

Quarterly reporting season also landed this week, which is the part of the calendar a lot of retail investors underrate.

For a pre-revenue explorer or biotech, the quarterly is the only window you get into how the company is actually being run. What got drilled, what got spent, and most importantly, what’s left in the bank.

It's the cleanest read you'll get on whether the company you're holding is three months from a rerate or three weeks from coming back to market with the hat out.

Here’s what caught our eye:

• We’re giving away an ounce of gold, for FREE

• Fortuna Metals folds rare earths and graphite into the rutile story

• Mount Ridley Mines brings on a metallurgist with the right CV

• The Pentagon goes from US$225m to US$55bn on drones

• Solstice Minerals nearly doubles on Nanadie depth

• Pathkey runs 50% on a Singapore semiconductor deal

• Intel posts its biggest month in half a century

One Ounce of Gold, Yours to Win, for FREE

One ounce of gold. Real, physical, from the Perth Mint. It goes to whoever calls the gold price in AUD closest at 12pm AWST on 1 December 2026.

Entry is free.

Gold’s been on a tear most of us never thought we’d live to see. The Iran war broke the bull run for about a fortnight, then the price went back to climbing. Central banks kept buying through the dip.

Meanwhile, the world’s debt pile crossed US$346 trillion last quarter, or roughly three times global GDP. Governments are now borrowing close to US$29 trillion a year just to keep the lights on. All of this adds chapters to the gold bull narrative.

Whether the next leg is another rip higher or a long sideways stretch is your call.

Closest to the pin takes home the ounce.

Enter here.

From Rutile Play to Three-Commodity Story

Fortuna Metals (ASX: FUN) had a hell of a week. Two announcements in three days and the share price up around 25% by Friday.

For new readers, FUN is a small-cap rutile explorer working in Malawi. Their project, Mkanda, sits 20 kilometres south of Kasiya, the largest rutile deposit on the planet. Kasiya is owned by Sovereign Metals (ASX: SVM), capped at roughly $460 million with Rio Tinto on the register.

FUN is working the same belt of rocks with the same weathered geology, but much earlier in the story.

Fortuna’s first announcement this week expanded the mapped rutile footprint at Mkanda from 37 km² to 53 km², with the high-grade core now sitting around 28 km².

That sits on top of a 180-240 million tonne maiden exploration target FUN put out three weeks ago, and that target was calculated on samples only four metres deep.

And there’s a lot more rock under that.

Then on Wednesday came the announcement we weren't expecting. Drilling at Mkanda picked up heavy rare earth grades and graphite intercepts in the same dirt, and the chemistry came back ahead of Kasiya on two of the three magnet metals that matter. Yttrium grades ran nearly double Sovereign's.

Rutile is the cleanest feedstock for titanium. Titanium goes into jet engines, missile casings and humanoid robots, and each humanoid uses up to 10 kilograms of rutile.

There's currently one humanoid being built every thirty minutes in China, and that pace of growth is only going up.

Dysprosium, terbium and yttrium are the magnet metals that sit inside EV motors and defence-grade electronics. Graphite goes into every EV battery on the planet, plus a long list of industrial uses.

At a $28 million market cap, Fortuna is currently valued at less than a fifteenth of its northern neighbour, despite working through the same geology. Graphite hits at Mkanda are already running several times Kasiya's average grade.

Aircore rigs roll into Mkanda late next month to drill below the four-metre depth limit of the hand augers. The last time deeper drills went into this geology, Kasiya’s resource jumped from 644 million tonnes to 2.1 billion.

A $28 million company sitting on the same belt of rocks as a $460 million neighbour, drilling three commodities the world is short of, with deeper holes about to go in. Hard to think of a setup we'd rather own right now.

MRD Hires a Lynas Hand for Grass Patch

Mount Ridley Mines (ASX: MRD) appointed metallurgist Chris Larder as technical adviser this week. It’s not a flashy headline, but the kind of move that’s crucial once a project gets close to flowsheet work.

Flowsheet design is the engineering blueprint that turns rock into a saleable product. It’s where critical minerals projects live or die.

Larder’s done that work at Wagerup (the WA alumina refinery) and Mt Weld (Lynas’ rare earth operation). Both sit in the part of Australia’s processing chain that governments are now actively trying to expand outside of China.

That experience maps neatly onto Grass Patch, MRD’s project just north of Esperance, where dysprosium, terbium, scandium and gallium are all sitting in the same corridor.

MRD already has early met testwork in the bank on Grass Patch, so this hire is about taking those results into proper flowsheet territory.

Every one of those metals is on the West’s critical minerals list. Bringing in someone who’s actually built flowsheets for these elements before tightens the pathway from resource to product.

Pentagon’s US$54 Billion Drone Bet

Last year the Pentagon spent US$225 million on drones. Next year it’s spending US$54 billion.

That’s the same budget line, multiplied by roughly 240, in a single planning cycle.

And when the US writes gigantic cheques like that, allies have to follow. NATO, Israel, Australia and parts of Asia all build militaries that plug into US gear, so when the gear changes, their defence buying changes with it.

On a military radar screen, a quadcopter drone currently looks about the same size as an F-35 fighter jet. Once spotted, it gets shot down a few seconds later. You can build drones cheap and smart and in swarms all you want, but if the radar sees them, none of that helps.

Adisyn Ltd (ASX: AI1) is developing a graphene material with Tel Aviv University that coats a drone and shrinks its radar signature by up to 100 times.

That same quadcopter, with AI1’s coating on it, now reads on radar at about the size of a bird. The next target, and what they’re working on right now, is making it insect-scale.

We announced AI1 had been added to the portfolio last week when it was 6.8c. By last Friday it was at 20c, after a graphene chip breakthrough on the Monday and an exclusive worldwide licence on the drone material two days later.

Meitav, Israel’s largest investment house, cornerstoned the $14 million placement that followed. Regal Funds Management came in alongside them. The placement shares allocated this Wednesday.

This week AI1 pushed to a new all-time high, then settled back to 21c by Friday.

The Pentagon’s announcement landed straight into the middle of all of that.

Subscribe now

Solstice Minerals Doubles on Nanadie Depth

We flagged Solstice Minerals (ASX: SOL) back in February when the stock was trading at 93c.

It closed this week at $1.66, a roughly 78% move while drilling kept confirming the size of the copper-gold system at Nanadie in WA’s Murchison.

The intercept that kicked the run off was 62m at 1.55% copper and 0.66g/t gold to end-of-hole, including 22m at 2.78% copper and 1.25g/t gold.

This week’s update pushed it further. Solstice completed its first diamond tail to 629.1 metres, confirming visible chalcopyrite (the copper sulphide ore mineral) across multiple zones and extending mineralisation at least 300m below previous drilling.

The existing resource sits at 40.4Mt at 0.4% copper and 0.1g/t gold. In a system like Nanadie, going deeper is how you find more copper, and Solstice just went 300 metres deeper than anyone has before.

A 10,000 metre Phase 2 RC program is already turning, with another 2,000 metres of diamond tails to follow.

Plenty of stories run hard and then sit. This one has reasons to keep moving.

Pathkey Runs 50% on Semiconductor Deal

Designing a custom chip from scratch is one of the hardest, most expensive things a tech company does, and there are not many people in the world who can do it.

The ones who can are paid like surgeons. A mid-level hardware engineer hits the job market and is gone within six hours. They get poached every six months by the same handful of companies who are themselves losing engineers to the same handful of competitors.

It’s the same group of well-paid people just swapping lanyards around basically.

This week, an ASX small-cap with a market cap of $30 million took a binding option on a company that automates what they do.

Pathkey.AI (ASX: PKY) finished the week up roughly 50% after announcing a binding option to acquire Singapore-based Chipforge, an AI platform that runs the chip design process end-to-end.

Engineers describe what they want the chip to do, the platform writes the hardware code and runs the verification tests, then takes the design through to a physical prototype.

Full custom chip manufacture is next on the roadmap.

The slowest and most expensive part of this whole process is verification, the work of checking that the design actually behaves the way it's meant to before the chips get manufactured.

Verification alone eats more than half the time and budget of a chip project. Chipforge does it in software.

The deal lands Pathkey inside a sector that McKinsey predicts will hit US$1 trillion a year by 2030, driven by AI compute, data centres, defence electronics and edge computing.

It also fits with what Pathkey already does. Their existing TrialKey platform applies the same agent-based AI architecture to clinical trial design.

It’s the same engine, applied to two of the slowest, most expensive industries on the planet. One to keep a close eye on.

Intel’s Biggest Month in Half a Century

Intel had its strongest month on Nasdaq in 55 years, with the stock up around 114% in April after years of losing ground to TSMC and Nvidia.

Revenue lifted more than 7% in the latest quarter to US$13.6 billion, helped by hyperscaler demand from Google, Microsoft and Amazon, plus OEM orders from Dell, HP and Lenovo.

The Trump administration converted US semiconductor support into a near 10% stake in Intel this month. Washington now owns part of a chipmaker the same way it owns parts of the steel and oil industries.

Inside AI compute, the bottleneck is also moving. The processor isn't the only ceiling anymore. The interconnect layer between chips, where signal speed and heat loss start to cap performance, is the new pressure point.

Adisyn's graphene material has a second application here. The same coating being developed for drone stealth also works in chip interconnects, letting high-performance chips talk to each other faster and run cooler.

The Wrap

We’re hoping to hear that drilling has kicked off across a couple of portfolio names next week.

Exultant Mining (ASX: 10X) is lining up its maiden drilling campaign in NSW, and Asian Battery Metals (ASX: AZ9) is gearing up to go again in Mongolia chasing copper-gold. Both have the potential to move quickly if the drilling proves up good grades.

May is the last real window for capital raisings before financial year end, so expect a run of placements across the small-cap space over the next few weeks.

We’ll be watching the upcoming federal budget too, with a few interesting rumours doing the rounds about what might land in it.

On our end, we’ve been sitting down with a handful of companies lately. Can’t say much yet, but readers will be the first to know as things firm up.

Plenty more coming.

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, 187,500 BHL shares, and 1,150,000 AZ9 shares at the time of publishing this article. Equities Club has been engaged by FUN, AI1, BHL, 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.

Since acquiring Mkanda in September, FUN has been progressing work to define the rutile system across the project.

Rutile is the highest-grade feedstock for titanium, a metal expected to see strong demand growth as lightweight titanium alloys become increasingly important in humanoid robotics.

Today's announcement adds heavy rare earths and graphite to the Mkanda story, and the project is reading more and more like the world-class Kasiya deposit immediately to the north.

Kasiya is owned by Sovereign Metals (ASX: SVM), which is valued at $460 million and has none other than Rio Tinto as share holders. SVM released a study two weeks ago valuing the Kasiya asset at USD$2.2 billion before tax.

Rutile is still the main game at Mkanda. But these results add two more revenue streams alongside it, and the closer FUN's chemistry tracks Kasiya's, the harder that $430 million market cap gap gets to justify.

FUN’s first heavy rare earth assays at Mkanda came back with a basket that looks like Kasiya’s.

The chemistry alone doesn’t close a $430 million gap, but every step that confirms the geology runs further south makes it harder to argue Mkanda is a different beast.

Aircore drilling kicks off in the coming weeks. It goes much deeper than previous drilling, and graphite grades are known to climb at depth.

That's where the graphite credits start to count.

With heavy rare earths on the board and graphite still to come, that valuation gap is starting to look stretched.

FUN vs SVM: How the Numbers Stack Up

Lining the assays up against Kasiya, FUN comes out in front on two of the three measures.

• Dysprosium-terbium came back at 3.1% versus SVM's 2.9%.

• NdPr was a touch lower at 19.7% versus 21.8%.

• Yttrium nearly doubled SVM at 20.1% versus 11.9%.

The samples FUN sent off were originally being processed for rutile, the project’s main game. Heavy rare earths were tested as a side analysis from material that had already been through the rutile workflow.

That workflow uses a magnetic separator to pull out the different minerals.

Dial up the current and you grab more magnetic material. FUN ran theirs at 2.4 amps, the right setting for clean rutile. SVM used 2.9 amps when targeting rare earths at Kasiya.

In plain English, FUN picked up these grades while running a process tuned for a different metal. Push the current to where SVM had it and the grades likely go higher from here.

The lab work also picked up monazite and xenotime, the minerals that hold the rare earths in the rock and the same ones SVM found at Kasiya. The geology is reading the same.

When SVM confirmed its own heavy rare earth credits in January, the stock moved sharply, up nearly 30% on the previous days close.

FUN’s now sitting on its own version of that catalyst.

Subscribe now

What These Rare Earths Are Worth

Dysprosium and terbium are heavy magnet rare earths, used in the high-temperature magnets that go into defence systems and precision weapons.

Q4 2025 prices in Europe sit at US$850,000 a tonne for dysprosium and US$3.6 million a tonne for terbium.

Yttrium goes into aerospace coatings and semiconductor manufacturing. The Q4 2025 price is US$270,000 a tonne, up roughly 4,000% on a year before.

The US imports 100% of its yttrium from China, and China has been tightening exports, so the US is looking for supply from another source.

There’s also a monazite by-product alongside the rare earths. Concentrate sells for over US$8,500 a tonne delivered to China and pulls out of the same processing flow at near-zero incremental cost.

That’s a third revenue line alongside rutile and graphite, with no extra capital required.

Graphite Builds With Depth

The graphite results came in alongside the rare earth work. The best hit was 6 metres at 4.93% Total Graphitic Carbon (TGC), the standard measure of graphite content in a rock.

Sovereign’s Kasiya is the world’s second-largest coarse flake graphite deposit. It averages 0.95% TGC.

Fortuna’s best Mkanda hits are running roughly five times that grade. A 10-metre intercept came in at 4.16% TGC, with plenty of other holes returning grades above 2%.

Another 115 hand auger holes are at Intertek in Zambia right now, with results flowing through 2026.

Grades have been climbing the deeper the drill goes, the same pattern Sovereign saw at Kasiya before aircore drilling confirmed the resource down at 20-30 metres.

Fortuna’s aircore rig kicks off in a matter of weeks and will tell us whether Mkanda’s graphite holds at depth.

Closing the Gap

SVM’s Kasiya ore reserve gets uplifted from 0.96% rutile to 1.51% rutile equivalent once graphite credits are added in. The graphite adds another 57% to the value of every tonne mined.

If Mkanda is Kasiya's twin, similar arithmetic applies down here, and FUN’s graphite hits are running several times SVM’s grades.

FUN trades at 6-7% of SVM’s value on the same geology, with assays still to flow this year.

Aircore drilling and metallurgical results are next, and that valuation gap is looking out of step with what's coming out of the ground.

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.

Mount Ridley (ASX: MRD) just hired theirs.

His name is Chris Larder, and his job is to turn the deposit at the Grass Patch project into something a Western processing plant will actually take.

Grass Patch sits just north of Esperance in WA, with heavy rare earths, scandium and gallium in the same deposit.

Larder has thirty years in mineral processing, and his flowsheet work in WA covers both sides of MRD's basket.

He's been involved in flowsheet design and review at Alcoa's Wagerup refinery in WA, the exact facility Australia and the US recently picked for a US$200 million gallium processing build.

He’s also worked on REE flowsheet design at Mt Weld, one of the only rare earth separation plants running outside China.

China has had its boot on the throat of rare earth processing for years. The US and Australia are finally throwing real money at prying it loose, with a lot of that build-out happening in WA.

Larder’s CV maps onto MRD’s deposit almost line for line - gallium at Wagerup, heavy rare earths at Mt Weld.

For a $41 million junior moving from a defined deposit and proven recovery into flowsheet design, that's about as targeted a hire as you can make.

MRD vs VTM - The Heavies

Grass Patch carries dysprosium, terbium, scandium and gallium. Four metals, all of them on the West's "we need this but we don't have it" list.

Dysprosium and terbium are the high-strength magnet ingredients that go into EV motors, wind turbines, fighter jet electronics and missile guidance systems.

China controls more than 90% of global supply and has been tightening export controls since late 2024.

Scandium is a strengthener for aluminium alloys used in aerospace and humanoid robot frames. Global production sits at around 25 tonnes a year. MRD has 18,855 tonnes in the ground.

Gallium goes into radar, semiconductors and EV fast chargers. China controls about 95% of refined supply there too.

On the heavies specifically - the part of the basket that goes into magnets - MRD’s resource holds 44,600 tonnes of contained heavy rare earth oxides. Victory Metals (ASX: VTM) North Stanmore, the most advanced ASX-listed clay-hosted heavy rare earth project, holds 57,400 tonnes.

MRD has roughly 80% of VTM’s heavy rare earth tonnes. It trades at $41 million. VTM trades at $223 million.

That’s MRD at about 20% of VTM’s market cap, with 80% of the heavies, plus scandium, plus gallium, plus a metallurgist whose CV maps onto the deposit line for line.

The market hasn’t priced much of that in yet. Larder’s job is to give it a reason to.

Subscribe now

What Larder Actually Does

Larder’s first piece of work is reviewing what came back from Lawrence Livermore National Laboratory (LLNL).

LLNL is one of three US nuclear security labs and runs on a US$3.7 billion annual budget. MRD shipped them a sample of Block 1 core last year under a Material Transfer Agreement, and a follow-up batch of around 200kg is already prepared.

Larder’s job is to read what LLNL has done with the first sample, then help shape the formal collaboration agreement that governs the next round of work. The CRADA, in industry speak.

The second workstream is the historical met testwork as Grass Patch has been drilled on and off for over a decade.

There are old reports, old leach results and old beneficiation data sitting in filing cabinets. Larder’s job is to pull it all together so the current programs build on what’s already been done instead of redoing it.

The third piece is the integrated flowsheet itself - the actual processing route that takes clay from the ground and produces a saleable product at the other end.

That’s the work Larder has spent thirty years doing, and it’s the work that decides whether MRD becomes a mine or a footnote.

There’s also re-assay interpretation on around 3,300 samples already submitted to the lab. The goal there is to expand and upgrade the Mineral Resource without drilling a new metre.

Sending old material to a lab to find something earlier explorers missed is the cheapest way to grow a junior’s resource. MRD’s entire rare earth discovery came from doing exactly that.

And he's also got a tech assessment brief - looking at processing technologies and licensing opportunities the company could plug into rather than build from scratch.

Five workstreams across LLNL, historical data, integrated flowsheet, resource expansion and tech licensing, all going through one experienced process engineer.

Where MRD Sits From Here

MRD joined our portfolio in March on the back of the maiden resource. Met testwork landed shortly after and cleared the first hurdle.

The Larder hire is the next step on the same path.

MRD has a defined heavy rare earth resource, met testwork that says the metals come out, and now a metallurgist with hands-on flowsheet experience at the two WA facilities those metals could realistically feed into.

All at a $41 million market cap.

The risks are the usual ones for a junior at this stage. Lab recovery doesn't always survive the jump to a flowsheet, and government funding pathways like the ones flowing into Wagerup don't always reach the projects you'd expect them to.

None of that is unique to Mount Ridley. All of it is the game.

What changed today is that the work of pulling those workstreams together now sits with someone who has done it before, at the exact facilities that matter for this deposit.

The Larder hire is the kind of step that closes the gap to peers like VTM, and we’re still backing the story.

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.

We said then it was a fraction of what was actually there. Today’s results are the first evidence backing that up.

For new readers, FUN is the small-cap rutile explorer we added to the portfolio at 4c. Their ground in Malawi sits 20km south of Sovereign Metals’ (ASX: SVM) Kasiya deposit, the largest rutile deposit on the planet.

Same belt, much earlier in the story.

Mkanda's mapped rutile footprint has pushed out from 37km² to 53km², a 40% expansion in a single batch of results. A 28km² high-grade core is taking shape inside it.

A brand new prospect has appeared in the centre of the project, with surface grades up to 2.5%. 73% of the latest 0-2m samples came back above the cut-off, averaging 0.9% rutile.

Best drill intercepts came in at 10m at 1.43% rutile, 4m at 1.22% and 5m at 1.04%, with surface samples peaking at 2.52%. Most of the 28 full-depth drill holes ended in mineralisation, meaning more rutile sits below where the auger stopped.

At 8.9c and a $25 million market cap, FUN still trades like an early-stage explorer despite an exploration target of 180-240Mt and 53km² of mapped rutile already on the board.

SVM is worth $460 million for the same belt of rocks.

Following the Kasiya Playbook

Rutile is the cleanest natural feedstock for titanium, and the titanium market is tightening as defence, aerospace and robotics demand keeps climbing.

FUN’s ground sits 11km from a major rail line connecting to a deep-water port in Mozambique, so the export route is already there.

Today's results pushed the system out further on both ends.

Fortuna’s new central prospect sits in the middle of the project, stretching about 5km north-south by 1km east-west. Standout surface grades came in at 2.5%, 2.05%, 1.89% and 1.74% rutile.

Up north, the Mbale prospect has stretched another 1.6km this batch, with shallow samples across the extension running at 1.5%, 1.07%, 1.01% and 0.94% rutile.

Twenty-eight full-depth drill holes also delivered, most of them ending in mineralisation.

That gives FUN two prospects growing at once across different parts of the project. Pair that with a 53km² footprint and the picture looks familiar, the same enrichment story that built SVM’s Kasiya into a 2.1 billion tonne deposit 20km north.

The first pass was a wide net by design. FUN punched out 675 holes on a 400m grid across 180km² to find where the rutile actually sits. With the hot zones mapped, the next round tightens to a 200m x 200m infill grid over the high-grade cores.

Rutile is showing up almost everywhere FUN puts a hole in the ground.

It's the same playbook SVM ran at Kasiya, just earlier in the cycle and at a fraction of the share price.

Subscribe now

What Actually Matters From Here

Today’s update is one piece of evidence in a much bigger run. The numbers that can move FUN’s valuation are coming in the next two quarters.

The first is depth. Hand augers can only drill to about eight metres before the water table stops them. FUN's current 180-240Mt exploration target is calculated on an average depth of just 4.1 metres.

At Kasiya, the rutile keeps going to 20-25 metres. SVM’s resource started at 644 million tonnes. After deeper drilling, it grew to 2.1 billion tonnes.

Aircore drilling starts at Mkanda in late May, with more than 5,000m planned. That’s the first proper look at whether FUN’s system holds at depth. If it does, the 180-240Mt target is the floor, not the ceiling.

The second is graphite. SVM’s ore reserve went from 1.03% rutile to 2.00% rutile equivalent once graphite credits were added. That’s the same rocks, with twice the payable mineral.

241 of FUN's drillholes are already in the lab for graphite analysis, with results due Q2 to Q3.

There's also a third commodity being tested from the same drilling, with rare earth results expected later this year.

On top of that, there’s a steady stream of rutile assays in the pipeline. 117 holes due mid-May, another 125 by end of June. All of it feeding into a maiden inferred resource estimate in the second half of 2026.

That’s a lot of catalysts for a $25 million company sitting on the same belt as a $460 million peer.

The Run-Up

Three weeks ago FUN had a maiden exploration target on the table. Today the footprint behind that target is 40% bigger, with a brand new high-grade prospect taking shape in the middle of the project.

The aircore rigs roll in next month to test depth for the first time. Graphite results land soon after. The maiden inferred resource is on track for the second half of the year.

The next six months decide whether FUN stays a $25 million explorer or starts closing the gap on a $460 million neighbour.

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.

In the four trading days between those two prices, a tech company a lot of our readers hadn’t heard of seven days earlier topped the ASX gainers board and added around $110 million to its market cap.

Weeks like that don't come along often.

AI1 had spent six years on a problem the semiconductor industry had not cracked in a decade.

They landed the microchip result on Monday, signed an exclusive worldwide licence on stealth drone material on Wednesday, and had a $14 million book filled mostly by Israel’s largest investment house and Regal Funds Management on Thursday.

By Friday's close, all the week's news was in the share price.

A lot of you got in on Monday. The posts started popping up not long after and didn’t slow down as the stock nearly tripled and hit daily volume records.

Six years of work for the Adisyn team. Four trading days for the market to catch up. And there’s plenty more to play out from here.

What caught our eye this week:

• Mount Ridley kicks off a 17,000-sample re-assay across Grass Patch

• Asian Battery Metals locks down 100% of Maikhan Uul ahead of fresh Mongolian drilling

• Goldman Sachs holds 2026 copper forecast at US$12,650/t, flags DRC supply risk

• Cochlear cuts net profit after tax guidance by 30%, share price at a decade low

• Canaccord forecasts a structural lithium deficit through to 2035

• PLS posts 52% revenue jump for the March quarter, share price testing $6 again

But first, who is Adisyn and what just happened...

AI1: From Tel Aviv to the Top of the ASX

A handful of people in a lab in Tel Aviv have been working on the same problem since 2020. The chip industry has been working on it for over a decade.

On Monday morning, Adisyn's team got there first.

That's the short version of what happened to AI1 this week. Here's the longer one.

Most chip factories on the planet make their chips with copper wiring. The wiring has been getting thinner with every new generation, and it's now thin enough that signals are stalling and resistance is climbing.

Graphene is the answer everyone agrees on. A sheet of carbon one atom thick, conducts electricity better than copper, holds up at dimensions where copper physically gives out.

The catch has always been making it. Graphene normally needs about 1,000 degrees Celsius to grow. A real chip factory caps out at 450. Cook a chip at a thousand degrees and you get a puddle.

That's the problem AI1's team in Tel Aviv has been chasing since 2020. On Monday morning, they cleared it. Full-coverage graphene on a 1cm by 1cm coupon, grown below 450 degrees.

No one else has done it. Imec, the Belgian research hub the entire chip industry uses to figure out what's coming next, has been publicly naming graphene as the answer for years.

AI1 just delivered the first version that actually works.

The market noticed by Monday afternoon. Around 40 million shares changed hands for roughly $3.5 million in turnover, a new all-time volume record for AI1.

Then Wednesday happened.

AI1 announced an exclusive worldwide licence with Ramot, the commercial arm of Tel Aviv University, on the same graphene platform - this time pointed at making a drone that radar can't see.

Right now, a quadcopter drone on a military radar screen reads as roughly the size of an F-35 fighter jet. Adisyn’s tech has already shrunk that signature by 100 times in lab testing. A full attack drone now reads on radar somewhere closer to a bird.

The next target is 1,000 times, where the drone shows up looking more like an insect than an aircraft.

Two breakthroughs inside 48 hours, on the same graphene platform, pointed at two markets each tracking toward hundreds of billions of dollars.

Thursday morning, AI1 announced a $14 million placement at 6.75c. Cornerstoned by Meitav, Israel's largest investment house with roughly A$190 billion under management.

Meitav cornerstoned another Israeli ASX-listed deep-tech company called Weebit Nano (ASX: WBT) in 2021. WBT now trades at a market cap just shy of A$1 billion.

They were joined in AI1 by Regal Funds Management, which has A$20 billion under management and a long track record of being early on good ASX tech.

Chairman Kevin Crofton and non-executive director Dominic O'Hanlon also tipped $200,000 of their own cash in on top, subject to shareholder approval.

Funds with $210 billion between them don't show up to a $14 million book unless they've spent serious time on the file.

The trading on Thursday set a new record. Over 60 million shares changed hands. Friday slotted in at 43 million, the second-biggest day in the company's history.

The volume record AI1 had held since Monday was beaten twice in three sessions.

Sitting behind all this is a capital-light commercial model. AI1 licences the tech, clips royalties, and lets someone else build the factories.

The global chip market is tracking toward US$1 trillion a year later this decade. Military drone spending alone is forecast to climb from around US$20.7 billion this year to US$66.5 billion by 2035.

AI1 doesn't need to own much of either market to justify a valuation several multiples above where it sits today.

Two weeks ago AI1 barely registered on the ASX. This week it was the biggest gainer on the ASX, with the smartest money in Israel and one of the sharpest small-cap funds in Australia on the new register. Equities Club subscribers had been told the Sunday before that a new addition was coming.

The market knows AI1 exists now. From here, the milestones do the talking. Repeatability testing on the chip side, the 30dB target on the drone side, and first commercial conversations with the chipmakers Crofton spent thirty years selling into.

All of that could be inside the next 12 months.

We’re not done with this story. Not even close.

MRD Opens a Low-Cost Path to Resource Growth

Mount Ridley Mines (ASX: MRD) is one of our portfolio companies, and it sits on three commodities the West desperately needs to source outside China - heavy rare earths, scandium and gallium.

All from one deposit in Western Australia, 25km from the deep-water port at Esperance.

This week MRD took a useful step toward growing the resource without spending much to do it.

The company submitted around 3,300 historical drill samples to the lab, the first batch of a broader 17,000-sample pipeline the team turned up while cleaning out their database.

The work targets better coverage across heavy rare earths, scandium and gallium, with the aim of lifting both the scale and the confidence of the current resource.

Most of these samples were drilled years ago when MRD was hunting nickel and copper. Nobody thought to test them for rare earths at the time. Now they’re sitting in storage, already paid for, ready to go.

For a junior, re-assaying samples already on the shelf is about as cheap as exploration gets.

It also feeds the story we keep coming back to on MRD, which is how wide the valuation gap has become with peer Victory Metals (ASX: VTM). VTM is trading at around a $230 million market cap this week, with MRD at around $41 million. VTM has one commodity. MRD has three.

On contained heavy rare earth oxide tonnage alone, MRD holds 44,600 tonnes against Victory’s 57,400.

That’s not a six-times difference.

If the re-assay work delivers the resource growth management expects, the gap between what MRD owns and what the market is paying for it gets harder to justify with every batch of results.

AZ9 lines up a fresh Mongolian drill run

It has been a little while since we last checked in on Asian Battery Metals (ASX: AZ9), but activity is picking up again across its Mongolian copper-gold ground.

AZ9 is a small-cap copper explorer with two discoveries in southwestern Mongolia, sitting eight kilometres apart in the same volcanic belt.

The flagship is Oval, a copper-nickel-PGE deposit that delivered 95% copper recovery rates earlier this year. That puts Oval inside the top 10 reported copper deposits globally for recovery, at a $18 million market cap.

The newer discovery is Maikhan Uul, eight kilometres up the road. A twin hole drilled in October pulled more than 20 metres of massive sulphide outside the existing resource boundary.

This week AZ9 took 100% ownership of Maikhan Uul. Drilling kicks off within a week as part of a broader 2026 campaign across the Yambat district.

The earlier work has already confirmed thick massive sulphide mineralisation, including a standout intercept of 14.5 metres at 2.23% copper and 0.73g/t gold, alongside multiple supporting zones of copper and gold mineralisation extending to at least 215 metres depth and open along strike.

Maikhan Uul also sits just eight kilometres from the Oval discovery, where AZ9 has already hit sulphide-rich mineralisation and identified what looks like a developing feeder-style system beneath the existing zone.

For that pipeline of targets, AZ9 still trades at roughly an $18 million valuation with around $6 million in cash.

If the upcoming drilling can repeat or extend those earlier sulphide intercepts, the market probably will not leave it sitting at this level for long.

Copper’s second-half setup keeps getting more interesting

Copper is back to looking like a second-half story.

Goldman Sachs held its 2026 copper price forecast this week at an average of US$12,650 a tonne. They also flagged real supply risk if the Middle East disruption drags on.

Their longer-run 2035 target sits at US$15,000 a tonne, but the near-term story is running on the supply side.

Sulphuric acid and diesel flows have been knocked around by the shipping disruption in and around the Strait of Hormuz, and it is landing on African copper producers first.

The most exposed are the operations using a chemical leaching process called SX-EW, which accounts for roughly 17% of global copper supply. The DRC has the largest concentration of these mines and is sitting on two to three months of acid inventory.

If delays push past late May, Goldman estimates DRC production alone could be curtailed by around 125,000 tonnes this year.

Demand is climbing on top of all that. Power grids are chewing through more copper as electrification rolls out, and AI data centres are adding another leg.

New supply is slower to respond than it used to be, with permitting timelines extending and grades falling.

Even on flat demand, the market looks short. Every junior copper hit gets a tailwind in this market.

Cochlear's Worst Day in Years Wakes Up Confession Season

One of the ASX's most reliable defensive names dropped nearly 40% in a session this week. Cochlear (ASX: COH) doesn't usually do that.

Cochlear is a global medtech that makes implantable hearing devices sold into hospitals across developed markets. The company has traded as one of the steadier operators on the ASX for years, which is why the downgrade landed as hard as it did.

The company cut FY26 profit guidance guidance to $290-330 million from $435–460 million. That is a ~30% reduction at the midpoint, wiped about $4 billion off the market cap in a single session, and sent the share price to a decade low around $100.

Developed market implant volumes have softened since January, with Western Europe particularly weak, and the stronger Australian dollar is doing extra damage on top.

Middle East disruption added cancellations, delivery delays and a one-off provision for receivables.

Small caps do this from time to time. A $10 billion medtech rarely does.

A defensive name issuing a downgrade of this size makes the rest of confession season worth reading carefully.

Lithium's Deficit Story is Back on the Table

Lithium sentiment has had a brutal couple of years. The long-term supply picture is starting to reassert itself anyway.

Canaccord is now calling a material structural deficit from 2026 through to 2035, driven by a chronic lack of investment in new supply rather than runaway demand. Even if higher prices in 2027–28 trigger a supply response, they say the gap stays open.

Markets are starting to respond.

PLS Group (ASX: PLS), the renamed Pilbara Minerals, dropped its March quarter today. The numbers land hard in this direction.

Revenue up 52% quarter-on-quarter, realised spodumene prices up 61%, and cash margin from operations up around 178%. The share price is up roughly 35% year-to-date and testing A$6 again.

That matters well beyond the majors.

Lithium juniors were the first names crushed on the way down, and they are usually the first to move when confidence comes back. The supply picture is now pointing the right way, and the money that left during the glut has a reason to come back.

The Wrap

There are weeks in this game that justify the rest of the years and weeks that test whether you should have got into it at all.

This one was the first kind.

There’s also a particular discipline required not to mistake one good week for the shape of a year. The job from here is finding the next one.

Some of the names in the rest of the portfolio are moving - MRD’s pulps to the lab, AZ9 to Maikhan Uul, copper tightening, lithium reasserting - but those stories will tell themselves in their own time, and we will be here when they do.

We’ll be back on the hunt tomorrow.

Till next week.

Subscribe now

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 2,083,333 MRD performance rights, 900,000 AI1 performance rights and 750,000 AZ9 shares at the time of publishing this article. Equities Club has been engaged by AI1, MRD, 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.

We added the company to the portfolio on Monday, after it cleared a semiconductor milestone the chip industry had been stuck on for over a decade.

Around 40 million shares changed hands that day, roughly $3.5 million in turnover, the biggest volume day in the stock’s history.

On Wednesday came an exclusive worldwide licence on the graphene material behind the next wave of stealth drones, signed out of Tel Aviv University.

And this morning, on the back of all that, the company pulled the trigger on a $14 million placement at just under 7c a share.

We’d usually be grumpy about a raise this soon after adding it to our portfolio. The details of this one took the sting out.

The bulk of the book went to two cornerstones. Meitav is Israel's largest investment house, with roughly A$190 billion under management, and sits inside the same Israeli defence and research ecosystem the stealth drone licence came out of.

Regal Funds Management came in alongside them. They have A$20 billion under management and a long track record of being early on the good ASX tech stories.

Chairman Kevin Crofton and non-executive director Dominic O'Hanlon tipped in $200,000 of their own cash on top.

Two things brought these funds onto the register. The interconnect breakthrough on Monday, and the stealth drone licence on Wednesday.

The Stealth Drone Licence

Right now, a drone on a military radar screen looks about the size of an F-35 fighter jet. AI1's tech has already shrunk that signature by 100 times in testing at Tel Aviv University.

The next target is 1,000 times, where the drone shows up looking more like an insect than an aircraft.

The country that builds it first gets a lethal edge in the next decade of airborne warfare.

The deal Adisyn signed is a binding licence between AI1’s subsidiary, 2D Radar Absorbers Ltd, and Ramot, the commercial arm of Tel Aviv University. It replaces the option AI1 had in place.

An option means you might own it. A licence means you do.

The licence gives Adisyn the right to earn royalties whenever the graphene tech is deployed in a drone or defence platform.

That’s how the drone side of the business turns into revenue.

AI1 is a graphene technology company pointed at two enormous markets.

One is chipmaking, where its low-temperature graphene process cleared a decade-old semiconductor roadblock earlier this week.

The other is drones, where the same graphene platform drives the stealth tech above.

Anyone who watched Droneshield (ASX:DRO) rip from 20c to over $5 knows what a defence thematic can do to an ASX small-cap.

Meet Ramot

Ramot is Tel Aviv University's commercial arm, and this will be the first time most of our readers come across them.

Ramot's partner list runs through the heavy hitters of global pharma and tech: Pfizer, Teva, Bayer, Novartis, Merck, Samsung, Google and Microsoft.

These companies pay Ramot to license Tel Aviv University research. The university is a global leader in applied physics and materials science (the two fields AI1's tech sits on).

Ramot’s defence credentials are just as serious. It’s been a strategic partner of Leonardo since 2023.

Leonardo is a A$32 billion defence giant that builds helicopters for armies, cyber systems for NATO, and sits alongside BAE, Lockheed and Raytheon. The partnership covers cybersecurity, unmanned vehicles and defence electronics.

They’ve also run research programs directly with the Israel Defense Forces.

These are the names Ramot usually sits across the table from. Handing an exclusive global licence to an ASX small-cap is not normal.

Ramot has its pick of partners. It’s telling that they chose AI1 for the exclusive deal.

The 20dB Story, in Plain English

Radar performance moves on a log scale. Every 10 decibels (dB) of 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. 40dB is 10,000 times.

AI1 has already hit 20dB in testing, and got there faster than they thought possible. The 12-month program that just got funded is now chasing 30dB.

Getting from 20 to 30 looks like a modest bump on paper. In physics terms, it’s a tenfold leap in stealth performance.

At 100 times, the radar operator spots the threat too late. At 1,000 times, the drone gets through undetected.

AI1 chairman Kevin Crofton, who spent three decades running businesses that sold into TSMC, Samsung and Intel, put it to us this way:

The 12-month research program chasing 30dB is costing AI1 less than A$100,000. In defence R&D terms, that’s a rounding error. A defence contractor spends more than that on a single week of engineering time.

AI1 is pointing it at exclusive rights to the next generation of stealth material.

The Drone Race is Now a Stealth Race

Ten years ago, drone development was about range. Then payload. Then autonomy. Now it’s about visibility.

Radar sees a drone early, the drone gets intercepted. Radar sees nothing, the drone gets where it’s going. That’s the whole game.

Monday’s portfolio addition piece walked through the defence spending numbers. Short version: Germany, the UK, the Pentagon and NATO have committed tens of billions to autonomous systems in 2026, and Australia added A$5 billion for drones a few weeks back.

This week, Australia put A$7 billion behind counter-drones specifically over the next decade, more than double the previous allocation.

Defence Industry Minister Pat Conroy called it “Star Wars happening right now.”

Every counter-drone system depends on detection. Lasers, missiles, interceptors. None of them fire until radar spots the threat. A drone the radar can't see slips past every dollar Australia just spent.

And more money spent shooting drones down means more money for drones that can get through.

Military drone spending alone is forecast to triple from US$20.7 billion in 2026 to US$66 billion by 2035. US investment bank Oppenheimer pegged the total addressable drone market at US$400 billion within a decade.

Inside all that money sits a materials problem. Stealth coatings work, but they add weight, and on a small drone every extra gram matters.

Graphene sidesteps the trade-off. It becomes part of the composite structure itself and absorbs the radar signal there. The drone stays light.

That’s the technology AI1 just locked up.

The Team

Adisyn’s managing director Arye Kohavi has been solving military logistics problems for nearly two decades.

As an IDF Special Forces commander, he saw what happened when frontline troops ran out of drinking water. In Lebanon or Gaza, supply could only come by convoy or helicopter.

In 2009 he co-founded Watergen to build a machine that pulls drinking water out of the air. Soldiers at the front had their own water source.

Watergen sold to the US Army, UK Army, French Army and IDF. TIME named it one of the 100 best inventions of 2019, and Foreign Policy put Kohavi on its list of 100 leading global thinkers.

Now he’s doing it again.

Alongside Kohavi on the drone side sits Professor Pavel Ginzburg, a radar physicist at Tel Aviv University who picked up a European Research Council Proof of Concept grant in February.

That’s one of only 150 handed out worldwide, and they exist specifically to push university research into commercial use.

Alongside him is Professor Maxim Sokol, whose speciality is advanced materials integration and scalable composite manufacturing.

Two serious operators working on exactly the problem every defence contractor is trying to solve right now. Reduce radar visibility. Keep the weight off.

Israel is the world’s testing ground for drone technology. Elbit Systems and Israel Aerospace Industries sit near the top of the Unmanned Aerial Vehicle (UAV) export market, and stealth has been a core edge of their platforms for decades.

Running a materials program in that ecosystem is about as close to the customers as you can get.

The Terms

AI1 pays Ramot a 4% royalty on net sales, and Ramot takes a 19% equity stake in AI1’s 2D Radar Absorbers subsidiary.

Both numbers keep Tel Aviv University aligned with AI1 for the long run. The more the tech sells, the more Ramot earns.

The whole commercial model stays capital-light. Someone else builds the factories and holds the inventory. AI1 collects royalties.

For a small-cap with two licensing shots at multi-billion dollar markets, the upside stays uncapped.

Subscribe now

What We’re Watching From Here

There are three main drone-side catalysts we see over the next 12 months.

• Lab results pushing toward the 30dB milestone. That’s the number that takes the drone story from proof of concept to the doorstep of commercial conversations.

• Validation across operational radar frequencies. Real battlefields operate across a wider band than any lab can replicate. Confirming performance holds up in the field unlocks live customer trials.

• First contact with customers. UAV makers and defence contractors have budgets they can deploy right now. Early engagement signals tell us how fast this goes from licence to revenue.

Defence procurement runs on its own clock and milestones slip. A graphene composite that works in Tel Aviv may need reformulation elsewhere, and AI1 is a small-cap with a long runway ahead of it.

The asymmetry is what we like. Less than A$100,000 of research spend, against a market writing the biggest cheques defence has seen in a generation.

When we added AI1 to the portfolio on Monday, we told you the company had two shots at multi-billion dollar markets. Four trading days later, both look a lot clearer.

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.

Every serious military on the planet is chasing that same goal right now.

The material that makes that drone possible is also the material at the heart of NVIDIA’s next generation of AI chips.

Every one of those chips runs into the same physical wall. The copper wires that have carried electricity through every computer chip for 40 years are running out of room.

The semiconductor industry has spent more than a decade trying to manufacture the replacement.

Meet Adisyn (ASX: AI1), our latest portfolio addition, which just cleared the milestone the multi-billion dollar industry's been stuck on.

What AI1 Just Grew

AI1 spent six years building a process to grow graphene, a sheet of carbon just one atom thick, inside the same equipment already running in every major chip factory on the planet.

Today it confirmed the result the industry has been chasing. Full-coverage graphene on a 1cm by 1cm coupon, grown at a temperature low enough for a real chip factory to use.

No one has done this before. It’s a world first.

Graphene has been the known answer to the copper problem for over a decade. The catch was always how to make it. Growing graphene normally takes around 1000 degrees Celsius, hot enough to melt any chip you’d want to put it on.

Most of the industry's decade of effort has gone into growing graphene cold using the same tool - a machine called a CVD, or Chemical Vapour Deposition reactor. Enormous sums have been spent on that path without a commercial result.

AI1 took a different path. They didn't try to fix CVD. They switched to a completely different tool - an Atomic Layer Deposition machine, known as ALD - and built their own chemistry for it.

AI1 is the only company we can find using ALD for graphene at fab-compatible temperatures, and both the process and the chemistry are patented.

That’s what got grown today. Continuous graphene, deposited via ALD, well below 450 degrees Celsius, which is the thermal ceiling any material has to sit under to make it inside a commercial chip fab.

The result opens the door to the conversation AI1 has been waiting six years to have. Engagement with the TSMCs, the Samsungs, the Intels, and the equipment giants that build for them.

At 6.8 cents and a $57 million market cap, we think the ceiling on this one is a long way up.

The Chip Industry’s Trillion-Dollar Problem

The chip industry has never faced demand like this.

Last month, NVIDIA CEO Jensen Huang told investors the company now has "high confidence visibility" of US$1 trillion in orders for its Blackwell and Rubin chips alone through 2027.

Just those two product lines. That's before the CPUs, the networking gear, or anything else NVIDIA sells.

The World Semiconductor Trade Statistics body, the industry’s main market tracker, forecasts the global chip market will hit US$975.5 billion in 2026, up 26% on this year.

One NVIDIA Blackwell server rack sells for around US$3 million. NVIDIA is shipping a thousand of them every week, and six million Blackwell GPUs have shipped in the past year. That's the scale of what the chip industry is trying to build.

The US government is putting real dollars behind bringing advanced manufacturing back onshore. The CHIPS Act has already committed US$6.6 billion to TSMC’s Arizona fabs, US$6.17 billion to Micron, and US$4.75 billion to Samsung.

Every chip built inside that wave hits the same bottleneck.

For decades, copper has been the interconnect material - the wiring that moves electricity between billions of transistors inside every chip.

It’s been getting thinner with each new generation, and it’s now so thin it’s behaving like a bottleneck rather than a bridge.

This means resistance rises, heat builds up, and signals start to stall inside the chip itself.

At the scale of an AI data centre, that inefficiency shows up in the power bill of an entire country.

Imec, the Belgian research hub where TSMC, Intel, Samsung and most of the world’s major chipmakers develop their next-generation processes, has publicly named graphene as the most promising replacement.

Graphene conducts electricity more efficiently than copper and keeps working at dimensions where copper physically breaks down. It also handles heat better, which matters when billions of transistors are firing at once.

The physics has been settled for over a decade. The obstacle has always been making it inside a real chip factory.

AI1 just cleared the first real step.

Subscribe now

The Drone Race is a Materials Race

We opened on drones for a reason.

The drones in operation right now are easy to see and easy to track. Almost every radar on the planet picks them up.

The real race is for the next generation: a drone that slips past radar, sits thousands of metres above a target undetected, drops in on a mission no human could survive, and comes home without anyone knowing it was there.

That drone doesn’t exist yet. The materials to build it are what every defence program in the world is now chasing.

Capital is pouring into drone tech broadly. A few recent prints:

• Anduril is raising US$4 billion at a US$60 billion valuation

• Helsing, the German AI drone maker, hit a €12 billion valuation this year

• AEVEX Aerospace listed in New York on Friday at US$2.7 billion on debut

• Stark, a German drone startup founded fifteen months ago, is already sitting on a US$500 million valuation after raising US$100 million from Peter Thiel and the CIA

Governments have opened the taps for drone tech too:

• Germany has committed €10 billion specifically to military drones, part of the biggest defence buildup since the Cold War

• The United Kingdom put up £6.5 billion under its latest Strategic Defence Review

• NATO members have collectively agreed to lift defence spending to 5% of GDP

• The Pentagon’s FY27 budget request includes US$54.6 billion for its newly formed Defense Autonomous Warfare Group, up from US$225 million the prior year

• Australia committed $5 billion to drones last week

Inside that race is a materials problem that's proven hard to crack: making a drone the radar can't see. That's where AI1 sits.

In lab testing, its graphene coating has already cut the radar return from a drone to one hundredth of its size. A full-size attack drone appearing on a radar screen at roughly the size of a bird.

The next target takes that to one thousandth. AI1 is working on the material that makes it possible.

AI1's radar-signature work is based in Israel, built around a partnership with Tel Aviv University.

Israel has been a testing ground for drone and defence tech for decades, and with every major military now writing cheques, that's a useful place for this work to sit.

The Two Markets AI1 Sits in Front of

Let’s take stock and pull back for a second, and look at what AI1 is actually selling into.

The global chip market is on track to hit US$975 billion next year, with most forecasts pointing to US$1.2 trillion by 2030.

Every device running a modern chip sits inside that number. That's the processor in your phone, the chips driving your car, the AI accelerators inside every data centre.

All of them hit the same interconnect wall, which is the one AI1 just cleared the first real step on.

That means the total addressable market for a working low-temperature graphene process is every high-performance chip built over the next 20 years.

Drones are the smaller market, but growing faster.

Military drone spending alone is forecast to triple from US$20.7 billion in 2026 to US$66.5 billion by 2035.

US investment bank Oppenheimer recently put the total addressable drone market at US$400 billion within a decade. The anxiety-inducing drone warfare videos coming out of the Ukraine-Russia war make it easy to see why.

And those figures are before you factor in what a working stealth material would be worth to any defence program chasing the next-generation drone.

Two massive markets, one materials breakthrough, and the same team behind both sides of it.

AI1’s market cap is $57 million.

Five Reasons We’re Backing Adisyn (ASX: AI1)

1. The Six-Year Overnight Success

Graphene has been the obvious answer to chipmaking's biggest problem for over a decade, and for just as long, nobody has been able to use it.

The reason was always temperature. Traditional graphene growth melts the chip. Every major chipmaker has known graphene was the material that extends the industry past copper's limits, and every one of them has been stuck at the same wall.

Adisyn started working on the problem in 2020.

The graphene tech came into Adisyn through the January 2025 acquisition of 2D Generation. The team, the patents and the R&D all came with it.

Six years, more than 20 specialists across three continents, and a research roadmap published in mid-2025 that set out three milestones in order:

• First (completed in January): a graphene-like carbon layer deposited below 300 degrees Celsius, independently verified by Professor Yoram Selzer of Tel Aviv University

• Second (landed today): A full 1cm by 1cm coupon, covered in continuous graphene, at a temperature a commercial chip factory can actually use.

• Third (in progress): repeatability across hundreds of samples under factory conditions, and scaling from coupon to full wafer

AI1 is the only company on the planet with a demonstrated process to grow continuous graphene at fab-compatible temperatures using an industrial ALD system. Both the process and the chemistry are patented.

Chairman Kevin Crofton spent 30 years running semiconductor businesses that sold into TSMC, Samsung and Intel. He knows exactly what happens next.

Crofton has told us that when he's asked chip companies what solving this would mean to them, the response has been blunt: "It's worth more than my company."

A working low-temperature graphene process is the kind of asset a chipmaker buys. It’s not licensed out in small pieces to competitors. It’s acquired, wholesale, by the first company that wants to own the interconnect layer of every advanced chip built for the next 20 years.

2. AI1 is Working on the Problem the AI Boom Keeps Making Worse

Every new generation of AI chip is harder to build than the one before it.

The transistors shrink. The wires that connect them shrink with them. At the scale of modern AI models, those tiny copper wires are moving so much data, so fast, that they're wasting enormous amounts of electricity just pushing electrons through resistance.

Every bit of electricity lost to heat is electricity not spent on computation.

NVIDIA’s Jensen Huang has called AI infrastructure the next electricity. He’s forecast US$1 trillion in chip orders through 2027 alone.

Every one of those chips runs into the same wall. TSMC, Samsung, Intel, Amazon, Microsoft, Google and every government trying to build its own AI capability needs a solution to the copper problem, and they needed it yesterday.

Graphene keeps working at dimensions where copper physically breaks down. It conducts more efficiently, runs cooler, and holds up under loads that melt conventional wiring.

The physics argument between graphene and copper has been settled for over a decade. The problem was always how to grow it inside a real chip factory.

AI1 has just shown a process that does exactly that.

The chips built for AI in the next 20 years are going to need a replacement for copper interconnects. AI1 is the only company we can find that has cleared the first real step on the industrial path to one.

3. The Drone Side is a Second Swing at a Real Market

Earlier this year, AI1 released early results on something the global defence industry has been chasing for decades.

Working with the commercial arm of Tel Aviv University, the company coated a drone in a graphene-based material and put it in front of a radar. The radar saw one hundredth of what it should have.

Management’s next target takes that to one thousandth, the point where a full-size attack drone shows up on a radar screen at roughly the size of a butterfly.

It’s worth flagging what that means and what it doesn’t. The one-hundredth figure is radar return - what the radar sees - not the drone’s physical size. And the one-thousandth target is where the company’s aiming, not where it’s got to yet.

It’s still the kind of result that turns heads in defence.

The program is led by Pavel Ginzburg, a professor of electrical engineering at Tel Aviv University and a globally recognised radar physicist. In February he was awarded a European Research Council Proof of Concept grant, one of only 150 handed out worldwide.

He's a serious operator, and the technical lead AI1 is building the drone program around.

The drone program is the same graphene platform pointed at a different problem, with its own addressable market and its own customer set. This kind of second shot on goal isn’t a small one, it’s big and the addressable market is only growing.

Potential customers are already spending. Germany has committed €10 billion to drones and counter-drone systems. The United Kingdom is putting up £6.5 billion. The Pentagon is asking Congress for US$54.6 billion.

The country that owns the invisible drone owns the next decade of airborne warfare, and AI1’s materials work is aimed squarely at that problem.

4. The Management Team is First in Class

AI1 is chaired by Kevin Crofton, a semiconductor industry operator with more than 30 years running the businesses that build chips for the world’s biggest fabs.

He has held senior roles at Lam Research and KLA, two of the four biggest chip equipment companies on the planet, both of which supply TSMC, Samsung and Intel directly.

Crofton then led the management buyout that created SPTS Technologies, a UK manufacturer of the machines that deposit and etch layers onto semiconductor wafers. Under his leadership, SPTS was sold to Orbotech for US$370 million in 2014, and Orbotech was then acquired by KLA for US$3.4 billion.

After SPTS, Crofton ran Comet AG, a Swiss-listed technology company, where he took the market capitalisation from CHF0.8 billion to CHF2.2 billion during his tenure.

He spent eight years on the board of SEMI, the global industry body for chip equipment makers, including a term as chairman. He has also advised the US government on semiconductor policy.

Crofton has spent three decades inside the rooms where the world’s biggest chipmakers decide which new technologies they adopt. He now chairs a company that has just cleared the exact kind of milestone those rooms are watching for.

Managing director Arye Kohavi runs the graphene program day to day, and he’s a serial entrepreneur having built a world-class technology company before.

In 2009, Kohavi co-founded Watergen, an Israeli company that built machines to pull drinking water straight out of the air.

The technology has been deployed in more than 65 countries, and is used for point-of-use drinking water in disaster relief, remote sites, clinics and military field settings.

Watergen was one of TIME magazine's 100 best inventions of 2019, named one of Fast Company's 50 most innovative companies, and was picked by the Israeli Ministry of Economy as one of the nine greatest Israeli inventions of all time. The company was acquired in 2016.

Foreign Policy magazine named Kohavi one of its 100 leading global thinkers in 2014.

A year later, Kohavi started work on the graphene program AI1 owns today.

VP of R&D Miri Kish Dagan spent decades running research and development in Israeli semiconductor and laser systems before joining the program.

Behind them sits a team of more than 20 specialists across three continents, with research partnerships at imec and an EU chip consortium that includes NVIDIA, Applied Materials and NXP.

No other ASX company at this market cap has a team with this kind of track record. In deep tech, who’s running the company is half the answer to whether the science ever gets out of the lab. AI1 has the other half already.

5. The Valuation Gap is the Reason we’re Here

$57 million at 6.8 cents a share.

With that you get:

• A patented low-temperature graphene process that has just cleared the milestone the chip industry has been working on for a decade

• A drone radar absorption program with a grant application going to the Israeli Ministry of Defence

• A management team that has already built and exited multibillion-dollar businesses in the same industry, and

• A legacy IT services business that still generates revenue.

Pitt Street Research, an Australian equity research firm, valued AI1 at 29 cents per share on a sum-of-the-parts basis covering the chip technology, the drone program and Adisyn Services. That's roughly four times today's close.

Our framing is simpler.

The global chip market is heading toward US$1 trillion next year. NVIDIA alone has forecast a trillion dollars of chip orders through 2027, and every one of those chips has the same copper interconnect problem AI1 is working on.

The military drone market is on track to triple by 2035, and NATO governments have just committed hundreds of billions to the autonomous systems AI1’s radar work sits in front of.

AI1 doesn’t need to own a big piece of either market to justify a much larger valuation than today’s. It just needs to keep clearing milestones.

Subscribe now

Our view on AI1 from here

Today's announcement is a technical one, and the market may take a beat to work out what it means. Here's our read:

The next 12 months are a straight line to commercial conversations. Repeatability testing across hundreds of samples, scaling to a full production wafer, and first partnership announcements.

On the drone side, management has set a target of hitting 30 dB radar signature reduction by the end of 2026. That's the milestone that takes the drone story from proof of concept to the doorstep of commercial interest.

Each one is a potential share price catalyst, and they are all sequenced inside the next 12 to 18 months.

This is the kind of company that gets bought. Applied Materials, Lam Research, KLA, ASML and Tokyo Electron have spent the past decade acquiring smaller businesses to lock in the materials and processes their customers need.

A low-temperature graphene process is exactly the kind of asset they pay for. Crofton himself built SPTS into a business that KLA eventually owned inside a US$3.4 billion deal.

He understands how this movie ends.

The six years of research, the specialist team, the IP position and the institutional partnerships with imec, Tel Aviv University and the EU chip consortium put AI1 well ahead of anyone else chasing the same problem.

A well-funded competitor starting today would be years behind, and the chip industry doesn't wait.

None of this is currently priced in to the 6.8 cent share price, and that’s why we are in.

We're backing AI1 from here.

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.

More on that in the morning.

As for the rest of the week, if you’d only glanced at the ASX 200 you'd have shrugged, put your phone down, and gone about your day. The index barely moved.

Meanwhile a refinery fire knocked out 10% of Australia's fuel, oil crashed 11% as the Hormuz story flipped twice in 48 hours, gold sat near US$4,800/oz, Eden put on 91% in a fortnight, and Yugo flew 54% on its first drill result.

The index seemed to sleep through the lot.

What caught our eye this week:

• Director buying ahead of drilling at Exultant Mining

• Defence spending piling into drones

• Scandium demand lifting on the back of AI infrastructure rollout

• Gold IPOs keep ripping out of the gate

• A DFS next door to Fortuna Metals reprices the corridor

• Over $5 billion in coordinated Australia-US critical minerals support

• Yugo Metals flies on first drilling hits

• Eden Innovations adds another 31% for a huge two-week run

A New Name Joins the Portfolio Tomorrow

Tomorrow morning we’re introducing a new portfolio addition in a thematic that’s running hot. Without giving the game away, here’s what you’re getting:

• Management team with decades at the top of the industry

• A multibillion-dollar market that's compounding faster than most people realise

• Commercial revenue within sight

• A valuation with plenty of room to run from here

Full breakdown lands in your inbox before market open tomorrow. If you’re subscribed, keep an eye out. If you’re not, hit the button below.

Subscribe now

Chairman Buying Ahead of Drilling at Peak View

This week, Exultant Mining (ASX: 10X) chairman Brett Grosvenor bought another 100,000 shares on market, adding to an already sizeable holding in 10X.

The rigs are weeks from turning at their Peak View project, targeting a copper-lead-zinc-silver-gold sulphide in New South Wales.

10X has mapped a target corridor using IP and gravity work across multiple 1.6km lines, alongside surface rock chips running up to 50.9 g/t gold over a 360 metre quartz vein trend. (Rock chips are hand-picked surface samples, so they tell you where to look, not what the bulk grade looks like.)

The upcoming program targets the biggest geophysical anomaly on the project, an area earlier drilling campaigns missed.

Directors see the targeting work before anyone else. Grosvenor’s buying right before the first hole goes in tells you he likes what he’s seen.

Peak View is about to get its first proper test.

Drone Funding Catches up to the Talk

Last week we said we liked the drone space. The funding numbers this week did the rest of the talking.

Australia this week flagged up to $5 billion of new spending on uncrewed systems, funnelled into programs with names that sound like rejected Tom Clancy titles.

Ghost Bat is a combat drone that flies alongside crewed fighters. Ghost Shark is an autonomous submarine that just entered service with the Navy this month.

The Integrated Investment Program is now spending $12 to $15 billion on kit like this through to 2036.

Three years of Ukraine has taught every defence ministry that a cheap drone can take out a $10 million tank, and the budgets are starting to reflect it.

The US, as it tends to, is going magnitudes larger on defence spend, with policy proposals pointing towards a US$1.5 trillion defence budget in 2027 and loitering and kamikaze drones near the top of the shopping list.

China’s also spending hard on the same tech.

The contracts are starting to flow, and there are two ways small-caps get their cut. The ones making the parts that go inside these things, and the ones digging up the metals that go inside the parts.

The Scandium Sweet Spot

Scandium used to be a specialist alloy story. This week it walked straight into the AI data centre trade.

Oracle just signed a master services agreement with Bloom Energy covering up to 2.8GW of solid oxide fuel cell (SOFC) systems. It’s the biggest single SOFC deal ever done.

SOFCs make electricity through an electrochemical reaction instead of burning fuel, and they rely on scandium-stabilised zirconia to work efficiently and last longer.

SOFCs already soak up around 47% of global scandium demand. A 2.8GW contract puts real numbers behind a market that had mostly lived in forecasts.

Bloom has deployed 1.2GW to 1.4GW globally to date, and entire national SOFC fleets usually sit in the hundreds of megawatts to low single-digit gigawatts. A 2.8GW order from a single customer is a big step up from anything the market has seen.

Sunrise Energy Metals (ASX: SRL), the most advanced large-scale scandium exposure outside China and Russia, has already run roughly 50% over the past month as the story flows into the share price. It’s now valued at roughly A$1.85 billion.

Which brings us to our portfolio company, Mount Ridley Mines (ASX: MRD).

MRD has scandium sitting alongside rare earth mineralisation across 367.98Mt at Grass Patch, and there are no large-scale primary Western scandium producers.

A big volume of pulps is still to be re-assayed for scandium, with clear scope to expand the resource footprint. At a $45 million market cap, we still think the scandium exposure inside MRD is getting overlooked.

Subscribe now

Gold IPOs Running Hot

Gold juniors are having a moment on the ASX. Three new listings in a few months have all rewarded the people who got in early, and the latest one ran harder than anything before it.

With the war in Iran at the negotiating table, the market is pivoting back towards gold, and the price closed the week stronger.

Here’s who’s been running, and who we think lists next:

Bison Resources (ASX: BSR) listed this week at 20c, ran as high as 95c, and closed the week at 57c. A 185% premium to issue price after five trading days.

The move followed a heavily oversubscribed $5.5m raise to fund its Nevada projects along the Carlin Trend, one of the world’s most prolific gold belts.

Black Horse Mining (ASX: BHL) listed in December and peaked at 220% above its 20c IPO price. They're drilling a historic Victorian gold mine that produced more than a million ounces before water forced it shut.

Valiant Gold (ASX: VAL) is the other one, holding well above listing after peaking at a 70% premium.

When gold is this strong for this long, investors are paying up for any IPO with clear geology and a credible path to proving it out.

Which naturally leads to the next question: who’s next?

Elk Range Mining earned a mention in our top stockbroker picks for 2026 article, and we think for good reason.

Elk comes to market with a permitted underground mine sitting on defined historical ounces, with processing infrastructure already in place. That’s a meaningful headstart over your average early-stage listing.

With gold holding near US$4,800/oz, Elk shapes up as the next gold float to keep an eye on.

The DFS Next Door to Fortuna Metals

Sovereign Metals (ASX: SVM) dropped its Definitive Feasibility Study (DFS) for Kasiya this week. The numbers make it pretty clear how valuable the rutile and graphite corridor in Malawi really is.

The headline figure was a pre-tax Net Present Value (NPV) of US$2.2 billion. SVM’s current market cap is around A$470 million.

A DFS is the study that tells you whether a project actually makes money, and NPV is the headline figure - the present-day value of all future cash flows once time and risk are accounted for.

It’s one of the cleanest ways to size up a project’s economic strength.

SVM closed the week up just under 6%. That one week’s gain in market cap is worth more than the entire market cap of Fortuna Metals (ASX: FUN), which sits around A$25 million.

FUN sits along the same geological trend as SVM, just south of Kasiya. SVM is now putting study-backed numbers against a multi-billion-dollar project, which validates the corridor itself at a valuation level.

We've been backing FUN as leverage into this region since we added it to the portfolio. Proven geology, now proven economics, and still trading at a fraction of what's sitting further down the belt.

Policy Support Keeps Building

More than $5 billion in coordinated export credit support is now being pointed at new critical minerals projects across Australia and the US.

Export Finance Australia and the US Export-Import Bank issued aligned letters of support across nickel, cobalt, rare earths and gallium supply chains.

For anyone not across it - letters of support are the step before financing, signalling to developers and investors that the money will be there once projects clear their milestones.

That’s governments moving from strategy documents to project financing, which is the step that usually moves a project from study to build.

For years, Western critical minerals projects have been stuck waiting for someone to underwrite the risk. China already underwrites its own.

Having two allied governments do the same in parallel is a different setup than the one small-cap developers have been working inside.

For small-caps like MRD with heavy rare earths and scandium exposure, the policy direction keeps getting clearer. Allied governments are backing domestic and partner supply chains directly, and that’s a better macro setup for emerging projects than anything we’ve had before.

Subscribe now

Yugo flies on First Drilling Update

Yugo Metals (ASX: YUG) ripped 54% this week to a roughly $34 million market cap after its first drilling update from the Erak Prospect at the Sinjakovo Project in Bosnia.

Early scout drilling hit shallow breccia-hosted mineralisation across gold, silver, copper and antimony, with a 7.1 metre zone from just 26.2 metres depth. The structure remains open along strike and at depth, and assays are due shortly.

Surface support was already there before the rigs turned. Historical trenching returned 61 metres at 1.5 g/t gold, and rock chips went as high as 7.9 g/t gold and 2,070 g/t silver.

Adriatic Metals is the reference point in this part of the world. They scaled a breccia-hosted system in Bosnia into a takeover at around US$1.25 billion.

Yugo is a long way behind that, but first-pass drilling confirming a live polymetallic system in the same belt is how those stories usually start.

The Strait of Hormuz: 48 Hours of Whiplash

Every paragraph of this section has a shelf life of about six hours right now, but we’ll do our best to wade briefly into the fog of war.

Overnight Friday was the wild one. Iran’s foreign minister declared the Strait of Hormuz “completely open” for the first time since the war started, oil crashed more than 11% in its biggest single-day move of the conflict, and the S&P 500 and Nasdaq both closed at record highs. For a few hours, it looked like the war premium was gone.

That already appears to be falling apart. Iran’s military said the strait had “returned to its previous state,” the IRGC opened fire on commercial tankers, and warned that approaching the strait would be treated as “cooperation with the enemy.”

A second round of US-Iran talks is now scheduled for tomorrow in Pakistan. The ceasefire itself runs out mid-week.

Friday was the market pricing peace. Saturday was the reminder that war is messy.

Gold gave back some ground on Friday, while oil juniors went the other way. Both those trades could flip in a heartbeat if the peace talks go sideways.

Eden Keeps Running

Last week we flagged Eden Innovations (ASX: EDE) after a 45% move. This week the stock added another 31%, taking the two-week gain to roughly 91%.

The latest announcement gives you the why. Eden launched its new EdenShield division targeting defence and national security applications, with products including hardened concrete and electromagnetic shielding materials.

Hardened concrete does what it sounds like. Stronger, more blast-resistant building material, useful for anything important from embassies to data centres.

Electromagnetic shielding protects sensitive electronics from interference, whether that’s electronic warfare or the weird guy next door with a big magnet.

Governments are writing bigger cheques for the infrastructure that houses all of this, and retrofits tend to land faster than full rebuilds.

This is why selective exposure to emerging small caps still matters. When a company sits in a sector with structural demand and starts moving from trials into commercial rollout, the market responds fast.

Eden’s two-week run is a reminder that the biggest percentage moves often come from smaller names sitting in the right theme at the right time.

What’s Next

The themes are all pointing the same way right now.

Defence budgets are turning into contracts, AI infrastructure is showing up in metals demand, critical minerals policy is moving from press release to cheque book, and gold sitting at records is keeping the exploration and IPO pipeline wide open.

With Iran (possibly) winding down it’s as good a backdrop for small-caps as we’ve had in a while, and several names we covered this week have drills turning or results pending over the coming weeks.

Tomorrow morning, we’re adding one more to the portfolio.

If you want to be first in line, hit the subscribe button below.

Till next week.

Subscribe now

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, 200,000 10X shares, and 187,500 BHL shares at the time of publishing this article. Equities Club has been engaged by FUN, 10X, BHL and 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.