Thanks. Also keen to see the calculations supporting it...

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Vector

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25/04/19

23:00

Post #: 38268351
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Originally posted by edshann: ↑

Vector the summary from Cathy's note of April 18. Target price $2.

New Century Resources (NCZ) has polarised the market ever since commencing trading in late 2017 out of the shell of Attila with the Century Zinc asset. Whilst we have maintained our BUY recommendation since initiating coverage in August 2017 with a $2.20 price target, we had a number of early concerns on delivery which progressively have been checked off in the ensuing 22 months. With total zinc recoveries consistently tracking above 50%, the third cannon set to lift mining rate to rated capacity and the company clearly on the verge of declaring commercial production, we feel derisking is well underway. With the price well below half our conservative valuation (assumed 50% recoveries for zinc in tailings), we feel the reward well outweighs the risk, and re-iterate our BUY recommendation.

 Market concerns are progressively being addressed. On the following pages we will talk to the market concerns, and progress to address these concerns in detail. The key concern has always been the ability to achieve economic zinc recoveries considering the material in tailings is inherently fine grained in nature. With recoveries consistently tracking above 50%, with plenty more optimisation in train, we feel the company is well on the way to disproving doubters on this point. With the slurry pipeline clearly not blocked, or concreted up, yet another early concern is also addressed.

All production is being sold either under existing long term off take agreements or to new buyers who favour the high lead in early concentrate parcels, with minimal penalties (minor for silica) in concentrate sold to date...

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Thanks. Also keen to see the calculations supporting it including TC, conc Zn/Ag grade assumed etc.

NCZ Price at posting: 85.0¢ Sentiment: Hold Disclosure: Not Held
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Thanks. Also keen to see the calculations supporting it...

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