Mineral Resources Ltd (ASX: MIN) saw its stock price plummet by 8.17% in Friday's trading session, as investors reacted to growing concerns about the company's financial health and future prospects. The sharp decline comes amid a challenging environment for lithium companies, with lithium prices having dropped by about 80% in the past couple of years.

According to recent financial reports, Mineral Resources, a major player in the ASX lithium space with a market cap of about $3 billion, has reported a significant increase in its net debt. For the first half of fiscal year 2025, the company's net debt stood at $5.08 billion, up from $4.4 billion in the prior corresponding period. This mounting debt has raised red flags among investors, particularly in the context of the volatile lithium market.

Adding to the company's woes are leadership challenges and legal concerns, creating uncertainty about Mineral Resources' future direction. These factors, combined with the overall pressure on the lithium sector, have led to a significant loss of investor confidence, as reflected in today's sharp stock price decline. As the lithium market continues to evolve rapidly, investors appear to be reassessing their positions in companies with high debt loads and uncertain prospects.