Lotus Resources has emerged as the most heavily shorted stock on the Australian Securities Exchange, as hedge funds target the small-cap uranium miner amid a severe share price decline.
The company’s shares have fallen approximately 70% year-to-date, creating a lucrative opportunity for short sellers who have piled into the position.
The intense shorting activity stands in contrast to the broader uranium sector, where short interest in rival producers has begun to ease.
According to the Australian Financial Review, funds have singled out Lotus Resources as particularly vulnerable, distinguishing it from peers that are seeing reduced bearish pressure.
The catalyst for the sell-off appears to be a shortage of sulphuric acid, a critical input for uranium processing, which has been exacerbated by the ongoing conflict in Iran.
This supply-chain disruption has hit Lotus Resources harder than larger competitors, leading to the sharp repricing of its equity.