SXY target price upgrade: • We upgrade FY20e EBITDA by 12% on stronger than expected revenues, and reported net debt levels (cash conversion review). Our price target is +29% to A$0.45/sh on a review of long term production forecasts to factor in reserves upgrades (our Project Atlas DCF now captures 94% of 2P reserves). • Macquarie 12-month price target: A$0.45 based on a NAV methodology. • Catalyst: FY20 result on 24th August Action and recommendation • Maintain Outperform. We see 60% upside potential to our NAV-based price target, which we expect to be realised as SXY delivers on its Surat production growth, additional customer gas contracts, deleveraging and reinvestment/capital program
