commsec valuation 5 25

Energy and materials
TZN2,
10/07/08 Terramin Australia: Time to BUY
Last Traded: $2.37 Market Cap: $250m Sector: Materials
Summary of
report dated
10/07/08
BUY / OUT PERFORM Valuation: $5.25
Analysis
On 29 May 2008 TZN announced that it was raising $16.5m by a Share Purchase
Plan, which was underwritten at $3.40 jointly by Austock and CommBank; 4.85m
shares were issued.
Outlook
Allocation of raised funds
TZN has raised funds for:
�� further exploration near Angas and Tala Hamza and at Menninnie Dam to find
further resources in areas that are highly likely to be successful, and
�� the acquisition of new projects, such as the Ain Bougda mineral concession in
Algeria.
TZN share price weakness
TZN is now commissioning its Angas mine in South Australia and it expects to make its
first concentrate shipment in August.
TZN’s share price has been weak recently, with various factors such as general market
weakness, the weakening zinc price, the capital and the commissioning of Angas
contributing. However, the last two years have shown that buying TZN after a short
bout of weakness has given very good returns.
Valuation and recommendation
Now is another good time to BUY. CommSec’s TZN valuation has been trimmed from
$5.30 to $5.25 due to a number of minor reasons that are outlined in this report.
CommSec re-affirms its BUY / OUT PERFORM recommendation on TZN.