Equirus Securities has reiterated its 'Long' rating on Lloyds Metals and Energy (LMEL), forecasting a 65% upside to a target price of ₹2,100 per share, up from the current market price of ₹1,272. Analysts Siddharth Gadekar and Shivansh Singh attribute this bullish outlook to LMEL's long-term cost leadership in iron ore and its strategic evolution into a diversified metals player. The company's expansion into copper and its partnership with Tata Steel are expected to enhance growth visibility and reduce earnings volatility.

LMEL's recent acquisition of a 49% stake in Virtus Minerals’ joint venture, VLMH, for $30 million, provides indirect exposure to CHEMAF, a capital-constrained asset in the Democratic Republic of the Congo (DRC). This move positions LMEL within a critical minerals ecosystem, crucial for the global energy transition, as the DRC holds over 70% of the world's cobalt reserves. The combined capacity of LMEL's DRC assets could reach 100ktpa of copper and 20ktpa of cobalt, alongside significant mining volumes.

Despite the positive outlook, Equirus has flagged risks including execution challenges, higher capital intensity, and geopolitical uncertainties in the DRC, which could impact the overall success of these strategic initiatives.