Ecograf (ASX:EGR) responds to ASX price query after shares rocket 51%

ASX battery minnow Ecograf saw its share price soar 51% today, and responds to a please explain query from the ASX.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Ecograf Ltd (ASX: EGR) share price soared higher today. Shares were up a phenomenal 51% by the closing bell after hitting intraday gains of more than 75%.

Today's big surge puts the battery material supplier's share price well into the green in 2020, up 56% since 2 January. For comparison the All Ordinaries Index (ASX: XAO) is down 11% year-to-date.

That's a remarkable gain for Ecograf's share price, considering it wasn't spared the carnage that ensnared most ASX shares following the COVID-19 panic selling. From 31 January through to 2 April the share price tumbled 67%. Since that low shares are up 317%, owing much to today's big bounce.

At the current price of 12 cents per share, Ecograf has a market cap of $43 million.

What does Ecograf do?

Ecograf aims to become a key player in supplying environmentally friendly natural flake and battery (spherical) graphite products to its customers. Those include the established (refractory, recarburiser, lubricant) and the emerging (lithium-ion battery) global markets.

EcoGraf plans to operate a diversified graphite portfolio, supplying high-quality Tanzanian natural flake graphite products. Working with TanzGraphite, Ecograf is targeting established markets in Asia and Europe. The company's multi-hub development is commencing in Kwinana, Western Australia to supply environmentally responsible battery graphite for lithium-ion batteries.

How did Ecograf respond to the ASX query?

When a company's share price rises at a blistering pace, the ASX tends to take notice. Today it requested an explanation from Ecograf in the form of a price query.

The company promptly responded, stating, "EGR is not aware of any information concerning it that has not been announced to the market which, if known by some in the market, could explain the recent trading in its securities."

So is there any other reason that Ecograf's share price may have shot higher today, alongside a large surge in the volume of shares traded?

According to Ecograf: "EGR notes an improved sentiment for battery mineral markets as increased production of electric vehicles and lithium-ion batteries are considered a key support for global COVID-19 economic recovery plans."

The company also mentioned the Aussie government's increased focus to secure supplies of critical resources, like battery graphite, outside of China. It also stated: "EGR notes today's articles from the Age and the Sydney Morning Herald that reflect this sentiment and quote EGR's Managing Director, Andrew Spinks."

Ecograf had no other explanation and noted that improved sentiment was beyond its control.

Following today's 51% leap, the Ecograf share price will be one to watch.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

A smiling businessman in the city looks at his phone and punches the air in celebration of good news.
Broker Notes

These ASX 200 shares could rise 50% to 60%

Brokers believe these shares could deliver big returns for investors.

Read more »

A girl is handed an oversized ice cream cone with lots of different flavours.
Best Shares

8 ASX All Ords shares that tripled in value in FY25

Just 8 out of the 500 companies making up the ASX All Ords achieved share price growth of 200% or…

Read more »

Broker written in white with a man drawing a yellow underline.
Broker Notes

Brokers name 3 ASX shares to buy today

Here's why brokers are feeling bullish about these three shares this week.

Read more »

Woman with a scared look has hands on her face.
Broker Notes

Bapcor shares fell more than 30% yesterday. Should investors buy in the dip?

Is this a value opportunity?

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Broker Notes

Broker raises price targets on 2 ASX 200 shares to buy

Ord Minnett has just upped its 12-month share price targets on 2 buy-rated ASX 200 stocks.

Read more »

Man with rocket wings which have flames coming out of them.
Share Gainers

Guess which ASX All Ords stock just rocketed 34% on strong earnings growth

Investors just sent this ASX All Ords stock surging 34%. Here’s what’s happening.

Read more »

A male investor wearing a blue shirt looks off to the side with a miffed look on his face as the share price declines.
Share Fallers

Why DroneShield, Gentrack, Metals X, and Northern Star shares are tumbling today

These shares are ending the week in the red. But why?

Read more »

A businessman looking at his digital tablet or strategy planning in hotel conference lobby. He is happy at achieving financial goals.
Share Gainers

Why Dimerix, Newmont, Regal Partners, and Titomic shares are storming higher

These shares are having a good finish to the week. Let's see why.

Read more »