Commodity price update: Moderating forecasts on possible détente, rates.

Research evidence excerpt

Commodity price update: Moderating forecasts on possible détente, rates.

Upside risks to our PO: 1) Stronger China demand than expected on government

stimulus measures, resulting in higher-than-forecast iron ore prices. 2.) Higher-than-

expected lump and grade premia. Kumba earns a premium to benchmark for its high-

grade product. 3) Weaker ZAR than modelled, as commodity currencies devalue in a

weaker commodity price environment, or as a result of political issues in South Africa. 4)

Better performance from Transnet, resulting in greater export volumes through the rail

and port infrastructure.

Downside risks to our PO: 1) China demand surprising to the downside on property-

developer defaults and/or tighter Government policy on

property/construction/infrastructure. 2) Rail/port (South Africa government entity

provider) performance disappoints, 3) Stronger ZAR than modelled. 4) Materially higher

capex as Kumba advances life extension projects. 5) Lower-than-expected lump and

grade premia.

Maaden (XSDRF)

Our price objective of SAR55/sh is based on a 50/50 blended valuation approach using a

target of 13x EBITDA applied to an average of 2026E and 2027E EBITDA and 1.3x

multiple applied to our NPV/DCF derived valuation.

Upside risks: 1) Commodity prices surprised to the upside on unexpected positive macro

or supply interruptions. 2) Positive exploration success 3) Positive project execution. 4)

Positive policy development in the Kingdom which benefits Maaden's position as

nominated national champion.

Downside risks: 1) Commodity prices surprising to the downside on unexpected negative

macro 2) Execution risk on projects. 3) Operational risks at exiting assets and 4)

Unexpected increase in energy prices driven by policy changes.

Metlen Energy & Metals Plc (XJKDF / XMTGF)