First Berlin Equity Research has published a research update on Rock Tech Lithium Inc. (ISIN: CA77273P2017). Analyst Simon Scholes reinitiated coverage of the stock with a BUY rating and price target of CAD 2.40.

Abstract
The Lithium hydroxide (LiOH), which RCK plans to produce at its converters, first in Germany and then in Canada, is a key precursor for cathode materials in the lithium-ion batteries used in electric vehicles (EVs) and battery energy storage systems (BESS). We expect European demand for LiOH to jump 270% to 338k tonnes over the six-year period 2024-2030, driven by continued robust EV sales growth (9M/25 European EV registrations jumped 32% y-o-y) and accelerating data centre-associated BESS construction. So far only one LiOH converter is operating in Europe – AMG in Germany. The AMG project is in the ramp-up phase and its planned annual capacity is 20k tonnes LiOH. Vulcan Energy’s Lionheart project recently achieved a positive final investment decision, but will not come online until 2028 with capacity of 24k tonnes LiOH. The supply of lithium hydroxide in Europe is analogous to that in rare earths in that over 80% is derived from China. Recent tightening of the Chinese supply of rare earths and other critical materials has put Europe on notice of its vulnerability in LiOH. RCK’s Guben Converter Project (GCP) on the German/Polish border, also with capacity of 24k tonnes LiOH, is fully permitted, has a binding offtake agreement with Mercedes Benz, is based on proven technology and has an operating cost only 8% above Vulcan’s lowest quartile figure of €3,588 per tonne LiOH. In March 2025 the GCP was granted strategic project status under the EU’s Critical Raw Materials Act (CRMA). The GCP is one of three projects in Germany to receive this designation. The other two are the Vulcan Lionheart Project and PCC Thorion GmbH (a graphite project). The EU strategic project status designation means that means that RCK is a strong candidate to benefit from the additional €3bn in financing earmarked by the EU for critical raw materials projects under its RESourceEU Action Plan announced earlier this month. Given the urgent need for new European LiOH capacity, we think RCK is well placed to achieve a positive final investment decision for the GCP in 2026. We reinitiate coverage with a Buy recommendation and price target of CAD2.40 (upside: 243%).