Focus Graphite Inc.
Raising Our Fair Value Estimate on Transformational Resource Upgrade
Published: May 25, 2026
Author: FRC Analysts
Disclosure: Focus Graphite Inc. has paid FRC a fee for research coverage and distribution of reports. See last page for other important disclosures, rating, and risk definitions.
Company Details
Sector – Basic Materials
Industry – Industrial Materials
Trading Information
Trading information – FMS.V : TSXV
Report Highlights
- Strong Share Price Momentum: Shares are up 26% since we initiated coverage in March 2026, and 333% YoY, significantly outperforming comparables (+33% YoY), and the Sprott Critical Materials ETF (+141% YoY), driven by company-specific progress, and strong momentum in the critical materials sector.
- Transformational Resource Expansion at Tétépisca: FMS reported an updated resource estimate on its Tétépisca graphite project in Quebec, which we view as transformational, positioning it among the world’s largest and highest-grade graphite projects. Indicated resources (higher-confidence category) increased 96%, while inferred resources (lower-confidence) rose 49%. Indicated resources now represent 84% of the total (previously 80%), reflecting improved confidence.
- High-Grade, Low-Cost Advantage – The deposit averages 10.2% graphite carbon, well above the typical 3–8% range for graphite projects. Higher-grade deposits are generally associated with stronger economics, and lower OPEX.
- Next steps: FMS plans to conduct metallurgical testing to determine recovery rates, supporting an independent Preliminary Economic Assessment (PEA) evaluating the project’s economic viability.
- Flagship Lac Knife – Advanced, High-Grade Asset: FMS is also advancing its flagship Lac Knife graphite project in Quebec. It is one of the world’s highest-grade graphite deposits, supported by an advanced independent feasibility study. The study estimates an after-tax NPV8% of $286M, while FMS trades at a $42M MCAP, an 84% discount, suggesting the market is not fully reflecting Lac Knife’s value, and assigning no value to Tétépisca. We believe both projects have the scale to operate as standalone companies.
- Clear Undervaluation vs Peers: Despite attractive projects in a prime jurisdiction, FMS is trading at $4/t graphite vs a sector average of $23/t, an 87% discount. This reinforces the view that the market has yet to fully recognize the value of FMS’ portfolio.
- Attractive Strategic Target: We continue to view FMS as an attractive acquisition target for mining and technology companies seeking stable, long-term North American graphite supply.
Price and Volume (1-year)
* Sprott Critical Materials ETF
* Qualified Person: Réjean Girard, P.Geo. (QC), President of IOS Geosciences Inc., a consultant to Focus Graphite. Focus Graphite Inc. has paid FRC a fee for research coverage and distribution of reports. See last page for other important disclosures, rating, and risk definitions. All figures in C$; commodity prices in US$.
Aims to supply graphite anodes for lithium-ion batteries in North America
Portfolio Summary
FMS vs Graphite Juniors
Source: S&P Capital IQ / Various / FRC
In December 2025, FMS received $14M in non-repayable government funding to build a high-purity graphite plant for military, defence, aerospace, and advanced technology applications
FMS stands out among comparable projects for its superior resource scale and grade, combined with below-average projected CAPEX and OPEX
Source: FRC
FMS is up 333% YoY, significantly outperforming the comparables average gain of 33%
Tétépisca Graphite Project (100% owned)
The updated resource estimate incorporates drilling since 2022, expanding the database to 150 holes (26,095 m) from 106 holes (16,467 m).
Source: Company / FRC
We believe this upgrade is transformational, positioning Tétépisca among the world’s largest and highest-grade graphite projects
Indicated resources (higher-confidence category) increased 96%; Inferred resources (lower-confidence) increased 49%
Indicated resources now account for 84% of total resources (previously 80%), reflecting higher confidence
Block Model
* Red shows high-grade areas, while orange/yellow and green represent mid-to-high and moderate grades
Source: Company
Grades declined by 0.5 pp to 10.2%, but remain well above the typical 3–8% range for graphite projects
High-grade deposits are preferred due to their potential for stronger economics and lower operating costs
Next steps: FMS plans to conduct metallurgical testing to determine recovery rates, which will support an independent economic study (PEA) evaluating the project’s economic viability.
Lac Knife Graphite Project (100% owned)
FMS is also simultaneously advancing its flagship Lac Knife graphite project, a more advanced-stage asset. Next steps include product testing with potential buyers, securing supply agreements, completing the environmental assessment (now in its final stages), permitting, and project financing.
With a 25+ year mine life, the project offers potential for long-term, stable graphite supply for prospective buyers
Recent Developments
Source: FRC
If successful, these programs could support future partnerships, customer engagement, funding opportunities, and commercialization efforts
Project Development Stages
Permitting underway; production expected by 2028-2029
2023 Resource Estimate (4.0% Cg cut-off)
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