For a minute, people rushed into lithium at a pace that made the chemical seem more critical than water. What is the reason? Most average investors understand that the electric vehicle stocks (EV) hype requires a lot of lithium for batteries to run those units around town, though you are not the average investor.

You are here today to move past the obvious and have come to the right place, so congrats. There has been a massive move in the global chess board, where most of the world's lithium is stored, delivering you two clear winners in this race on a silver platter.

The United States and China are battling on many fronts today, with a race for advanced chips and the takeover of the world's EV market, which is why diversification is more critical than ever. Once you are diversified enough, it is time to risk a bit to win a lot, but more on that later.

Hats off to Strategy 

Recently, Chinese EV manufacturer BYD (OTCMKTS: BYDDF) has made advancements toward expanding its footprint into Europe and Latin America. However, the latter is where not one but two jackpots were found. 

Now that the world's largest lithium holder, Chile, has changed the game through government rulings on land and mining rights, BYD was the highest - or better - bidder for a competing landscape into lithium supplies.

While most of BYD's lithium processing capacity has been concentrated in China, management realizes the vast opportunity that is to be found in Latin America, especially as they seek to increase their sales footprint in the region. 

What is the first step of a bigger master plan? A $290 million lithium-processing facility at the heart of the world's lithium depository, northern Chile.

Understanding the economic benefits for the more broader population and tax implications, the government has agreed to proceed, giving BYD preferential prices for lithium coming from these new plants.

This is truly a game changer since better pricing for the main components in batteries will allow BYD to become even more competitive against industry giants like Tesla (NASDAQ: TSLA); rumors say that BYD is one quarter away from overtaking Tesla in total EV sales.

There is enough time out there to sit and speculate on the outcome for these EV makers. However, the opportunity most investors out there will not spot is the implications of a massive demand tailwind on the one Chilean lithium miner that BYD chose to deal with.

Sociedad Quimica y Minera de Chile

Some of Wall Street's brightest minds, such as Ray Dalio, are betting on the future of China's recovery being better than most other bears seem to think. Understanding BYD's - and China's - ambitions to become the EV technology and scale leader can help you fill in these blanks.

Who will be responsible for operating and processing BYD's $290 million plant? A heavily discounted value stock called Sociedad Quimica y Minera de Chile (NYSE: SQM). Hovering near its 52-week low prices and offering a staggering 3.4% dividend yield, this little-covered company may be your easiest win this year.

This stock has delivered a lackluster performance so far into 2023, with a net decline of 23.6%, severely underperforming the S&P 500 by as much as 37.4%. The performance gap makes more sense, considering this is an international - almost emerging - market stock.

However, some analysts have been brave enough to stick their necks out. With a consensus price target of $80.6 a share, there is an implied upside of 37.3% from today's prices. This level still needs to reflect the upside potential coming from this BYD deal.

Is there any hype of the past left in today's valuations? The answer is a resounding no, especially considering where this stock's price-to-earnings ratio lands today. With a 4.5x multiple, this company is dirt cheap and the cheapest it has ever been since its IPO.

Considering the company's financials, significantly its 25% plus net income margin, any upside jump in sales coming from BYD's volume will add significant gains to earnings per share; here is where things get interesting.

You could potentially get a two-way push here since the stock needs to expand on its P/E multiple, and the underlying earnings are set to rise explosively on added revenue; valuations are looking up rather quickly with minimal downside risk.