Syrah Resources
(ASX: SYR)Share Price and News

About Syrah Resources

Syrah Resources is a graphite company, one of the few outside of China. operates two major assets: the Balama Graphite Operation in Mozambique and the Vidalia AAM Facility in Louisiana, USA.

The Balama site is one of the world’s largest graphite mines, providing a critical upstream source for battery-grade material. It has a 108Mt reserve at 16% Total Graphitic Content (TGC) and produces 350ktpa per year (at least in theory).

Meanwhile, the Vidalia facility supports Syrah’s downstream strategy to produce AAM for lithium-ion batteries, serving the North American market including customers like Tesla, Ford and Samsung. This vertically integrated model, bridging raw material extraction and refined anode output, positions Syrah uniquely in the global supply chain. It produces 11.25ktpa.

The company has strategic appeal for many reasons including offering supply diversification, its ESG practices, vertically integrated model and cost-competitiveness.

Syrah's Company History

Founded in 2007, Syrah Resources began as a mineral exploration firm before pivoting to industrial minerals.

Its major breakthrough came with the acquisition and development of the Balama Graphite Project in Mozambique, which it first picked up in 2015 and commenced a feasibility study. First output came in 2017 and production began in 2019. But it has been a turbulant history with suspension for 1 year during the pandemic and a suspension from late 2024 due to farmers' protests.

The Vidalia AAM Facility in the southern United States is Syrah's other foray, partly in response to difficulties in Mozambique and also as a broader strategy to capture both ends of the graphite supply chain.

In 2022, Syrah made an FID, won Telsa as an offtake customer and was selected for multiple grants and tax credits from the US government. 2024 saw construction complete and production commancing, but predatory Chinese pricing and US policy changes were a challenge.

Future Outlook of Syrah Resources (ASX: SYR)

Syrah Resources faces a pivotal few years ahead. Despite the fact that the outlook for graphite and AAM remains positive, with demand for electric vehicles, energy storage, and cleaner technologies continuing to rise; the path isn’t without challenges.

Price volatility in graphite markets, operational risks at Balama, and delays in Vidalia ramp-up have impacted cash flow and investor confidence.

In 2024, the company reported revenue of US$31.5 million, a 34% decline year-on-year, and a net loss of US$125.3 million. Despite these figures, analysts expect a turnaround, with breakeven projected for 2026 and profitability by 2027, assuming an annual revenue growth rate of around 60%.

Syrah is well-positioned to supply the graphite market, especially with geopolitical pressure to secure critical minerals outside China. The Vidalia plant is key to this strategy, offering a local supply chain solution for US battery makers.

Is Syrah a Good Stock to Buy?

Syrah Resources offers a mix of high-risk, high-reward potential. On one hand, the company’s vertical integration and its position outside China provide strategic advantages, particularly as global players seek diversified graphite supplies. Its future role in electric vehicle battery supply chains is promising, especially if production at Vidalia ramps up smoothly.

On the other hand, Syrah remains in a loss-making phase. The 2024 earnings (not to mention its challenges at Balama) underscore the pressure on margins and the urgency to scale up revenue. The share price has fallen significantly, yet analyst price targets suggest a potential upside if growth targets are met. Volatility remains a concern, and the stock is far more suited to investors with a higher risk appetite.