Why am I investing in CYM - this was posted 4 months ago - have updated.:
When you investigate the number of small to medium sized copper companies on the ASX that are likely to enter production, particularly as they need to overcome:
1. People - competent people are hard to find. Team has been grown in last 6 months
2. Resource - this can be a bit of luck. Metallurgy and drilling at Nifty and Nandie has increased the size of both of those resources.
3. Permits - can take ages. All completed for Nifty - mining license already exists. Updating.
4. Finance - this depends on existing cash as well as confidence in people to deliver. 50 million in the bank with a high copper price makes this very likely.
5. Location - honestly outside of Australia just makes doing anything that much harder - nothing changed here.
6. Infrastructure - for most companies this is a massive barrier to mine development - whether it be logistics / power / water or general site. We now know this is a major advantage for Nifty as other projects hoping to go to development has to wait 2+ years on structural steel.
The only company I can see in copper on the ASX that meets all the above confidently is CYM. Definitely a couple of other copper plays I believe have value but in terms of this is going to happy 99% - then that is CYM.
Makes the valuation upside fairly easy in my opinion as while we are still subject to the vagaries of the copper price longer term the risks are much reduced to the above 6 items being ticked off.
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