broker recommendation, page-4

Hi M and gs - its a long document -( I'm a DJC client as well as an E Trader)analysing the iron ore scene and detailing a few producers and a few specs. I can email it all if you want . A lot of what is there about BRM was released at the AGM in Wayne Richards presentation. DJCarmichael's main financial points :
Valuation: BRM has a market capitalisation of just over $110m
fully diluted ($1.30/share) which gives the company an appealing
EV/t of just $2.44 (compared to an explorers average of $4.00/t).
We value BMR at $2.16/share with ore transport logistics,
metallurgy, additional resource upgrades and scoping figures still
to come over the next few months which we see adding significant
value as the project goes forward.
Key Points
Perfectly positioned in close proximity to three rail lines
one of
which (BHPs) passes through their lease.
Transport MoU still to be negotiated, likely partner would be
FMG given the affiliation of Management and current litigation
across other infrastructures from RIO and BHP.
Upside potential of 100Mt DSO ore, located just 35km from
Cloudbreak and 15km from BHPs Yandi and RIOs
Yandicoogina multi-billion tonne orebodies.
Rail will be the key. The Fortescue Valley marsh to the north will
require some creative thinking to put a railway in proximity due to
environmental regulations. A raised rail link will most likely solve
this problem.
Upside in iron pisolite concentrations in the top 10m of material
may serve as potential easily upgradeable material for
processing early on in the projects life.
Cheers, Archer