Broker names 2 small cap ASX lithium shares to buy

If you’re interested in small caps and lithium shares, then read on!

Listed below are two small cap ASX lithium shares that have been tipped as speculative buys by analysts at Bell Potter.

Here’s why the broker is bullish on them:

Green Technology Metals Ltd (ASX: GT1)

According to the note, the broker has a speculative buy rating and $1.37 price target on the company’s shares. This compares favourably to the latest Green Technology Metals share price of 83 cents.

Bell Potter highlights that the company is well-placed to supply the massive North American electric vehicle (EV) market in the future. It commented:

GT1’s hard rock lithium assets are located in Ontario Canada, on the doorstep of North America’s fast evolving EV manufacturing sector. The company is fast tracking appraisal activities in partnership with leading mineral investment and processing groups and established North American lithium developers. GT1’s asset locations bring ESG benefits through proximity to end markets and the potential to employ established low-carbon electricity generation through its processing operations. Our valuation is supported by modelling a potential project development at Seymour.

Red Dirt Metals Ltd (ASX: RDT)

Another small cap ASX lithium share that the broker is positive on is Red Dirt Metals. Its analysts currently have a speculative buy rating and 95 cents price target on its shares. As a comparison, the Red Dirt Metals share price is currently fetching 72 cents.

The broker notes that this Western Australia-based lithium explorer owns the Mt Ida Lithium Project. It has also recently acquired the promising Yinnetharra Lithium Project. The latter is a 520 km2 exploration project which has identified potential lithium mineralisation-hosting geology at surface over a 7km strike length. Its analysts commented:

RDT is leveraged to the electrification thematic, and growing lithium market demand. The company is now advancing two pre-Resource, Western Australian, lithium projects. […] Our valuation is supported by a risked and diluted assessment of a potential project development at the Mt Ida Lithium Project, which we estimate could convert to a Reserve of 10Mt at 1.4% Li2O, supporting a 10-year mining project and concentrating at least 1 Mtpa of ore to produce at least 210 ktpa of SC6 (31 ktpa LCE).

The post Broker names 2 small cap ASX lithium shares to buy appeared first on The Motley Fool Australia.

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