from wise owls Recommendation Recommendation Spec Buy First Recommended 10-Apr-2012 Current Price 1.58 Target Price 2.4 Stop Loss 1.1 Earnings Market Capital 689.7m Price Depth Strong
Discovery Metals has delineated a significant mineral reserve and procured substantial funding to establish a mining operation at Boseto. With construction now nearing completion, maiden production is expected within the current half year. Fully financed to complete development, and with only modest hedging in place, we expect copper prices to be a major share price driver. Upside also rests in the company's goal to establish a long life, 50,000tpa operation by developing underground and neighbouring resources. Output of copper concentrate is currently scheduled at a rate of 34,400t over 15 years, although recent exploration success could support a larger operation. Commissioning issues are a risk, however as the potential scale of Discovery Metal's Boseto Project becomes salient, we are issuing a 'speculative buy' recommendation.
DML Price at posting:
$1.60 Sentiment: LT Buy Disclosure: Held
