Pilbara Minerals is Australia's largest lithium producer, operating the flagship Pilgangoora operation in Western Australia's Pilbara region. The company produced 754,000 tonnes of spodumene concentrate in FY25 and maintains a market capitalisation exceeding $12 billion.

What sets Pilbara apart is its scale advantage and balance sheet strength. With over $1 billion in cash, the company weathered the lithium downturn without compromising its asset base. Management has focused on improving operational efficiency through ore-sorting technology and exploring downstream integration opportunities that could capture more value from the lithium supply chain.

The stock has rebounded strongly from its $1.07 low earlier this year to trade around $3.20-3.80 currently. While this represents significant recovery, Pilbara still trades well below its 2022 highs above $5.00, suggesting room for further upside if lithium fundamentals continue improving. For investors seeking exposure to the sector's largest, most liquid name with demonstrated operational resilience, Pilbara represents the core holding.

Liontown Resources has delivered a 75% gain year-to-date, reflecting investor confidence in its Kathleen Valley lithium mine in Western Australia. The company successfully ramped up production through 2025 and is positioning to become one of Australia's major lithium producers.

Kathleen Valley's advantage lies in its high-grade ore, which translates to lower processing costs per tonne of lithium produced. This cost competitiveness matters significantly in a commodity market where margins compress during price downturns. The mine produced its first spodumene concentrate in mid-2024 and is progressively increasing output toward nameplate capacity.

We believe Liontown offers compelling growth exposure for investors willing to accept higher volatility than Pilbara. The company is transitioning from construction to full production, which typically drives margin expansion and cash flow generation. However, execution risk remains until the operation demonstrates sustained production at target rates.

Mineral Resources provides diversified exposure across both lithium and iron ore, reducing single-commodity risk. The company operates the Wodgina lithium mine and owns a 50% stake in the Mt Marion lithium operation.
This diversification proved valuable during lithium's downturn, as iron ore earnings helped sustain the business. The stock recently jumped 40% following Chinese mine closures, demonstrating how quickly sentiment can shift in this sector. With lithium representing a significant but not exclusive revenue stream, Mineral Resources appeals to investors seeking commodity exposure with built-in downside protection.
The company's mining services division also generates steady cash flow, providing another buffer against lithium price volatility. For conservative investors concerned about putting all their eggs in the lithium basket, MIN's structure offers a more balanced approach.