SPROTT's Latest Research NoteTicker: SVM AU Cash: A$6.0m...

SPROTT's Latest Research Note
Ticker: SVM AU Cash: A$6.0m Project: Kasiya / Nsaru, Malingunde
Market cap: A$250m Price: A$0.59/sh Country: Malawi
RECOMMENDATION: BUY TARGET (up): A$1.40/sh RISK RATING (down): HIGH
Today’s MRE update and scoping study demonstrably place Kasiya as the best, highest grade, highestmargin undeveloped mineral sand asset globally. The unique derivation has not only enabled the best
mineralogy and metallurgy, but today’s graphite grades ~25% ahead of our forecast add valued revenue,
and strengthen the assets ESG credentials against polluting ilmenite assets in difficult political jurisdictions.
Better still, we expect the ‘same again’ in ~6M as neighboring Nsaru potentially doubles the existing
economics. Even holding that at only half the value of Kasiya, our estimated A$1.2bn NAV10% net of
minorities equates to a FD 1xNAV of A$2.75/sh. For now, we maintain our BUY rating, lifting our PT from
A$1.30/sh to A$1.40/sh based on a 0.5xNAV multiple for Kasiya as published today, adding half of that to
capture Nsaru. Our estimates for a fully-funded and fully-diluted NAV at first production of ~A$2.75/sh
demonstrate the upside here

https://jwp.io/s/iywTZsgY?utm_medium=email&_hsmi=196172907&utm_content=196172907&utm_source=hs_email

Scoping Study Highlights

Sovereign Metals LimitedScoping Study at Kasiya Rutile Project in Malawi confirms global significant status. Kasiya is the largest undeveloped rutile deposit in the world and therefore is highly strategic in a market characterised by extreme supply deficit. Managing Director, Julian Stephens said, “To have achieved this fantastic Scoping Study milestone for the Kasiya Rutile Project within just 20 months of the initial discovery is a huge result for Sovereign and a testament to the dedication and hard work of our Malawi and Australia-based team. The Kasiya Rutile Project is the largest undeveloped natural rutile resource in the world and is therefore highly strategic in an environment of severe global supply deficit. We believe that Kasiya is also just the beginning of the story in the new Central Malawi Rutile Province. We will expand our resource significantly early next year with the addition of the Nsaru Rutile Deposit and potentially other regional prospects.”

Read the Full ASX Release here