buy rating, page-2

That is not very encouraging report at all. For a number of reasons.

Investec are a very powerful Institutional broker in South Africa. The fact that their research has found it's way onto public forums frequented by retail investors suggests a number of things to me. Pretty much all bearish I am afraid.

1. Their research and analysis has not found a receptive ear amongst Institutional Investors. Institutional Investors would be buying the stock hand over fist if there was genuine upside but they must judge the risks to outweigh the rewards. South African Institutions would know full well their Domestic coal market! If they don't think CCC are a decent investment here despite the enthusiastic promotion of the Brokers then why should foreign retail Australian/English investors think they know better about the South African domestic coal market ?

2. This would answer the question why CCC were forced to approach 'funders of last resort' such as Dutchess for financing. Once you go to a last resort financier they pretty much know why you are at their door and the charges are no doubt commensurate with that 'service'.

3. In turn this sends signals to the rest of the market and one of the biggest signals for short hedge funds is indications of financial distress.

4. Any Corporate in negotiation with CCC with regards to strategic partnerships will no doubt be doing due diligence on CCC from operating, geological, mining, engineering and FINANCIAL perspective. In the middle of negotiations a Company approaching 'last resort financing mechanisms' is not going to fill any counterparty with confidence.