AUSTRALIA FIRST TO MARKET

Research evidence excerpt

AUSTRALIA FIRST TO MARKET

Asia Pacific Equity Research

Australia First to Market 21 July 2026

Top Stories

Init | Nickel Industries (Lyndon Fagan) (NIC AU, OW)

Significant growth outlook undervalued by the market; initiate at Overweight

We initiate coverage of Nickel Industries (NIC AU) with an OW rating and Jun-27 PT of A$1.45, using an $18k/t LT real Ni price;

our PT implies ~70% upside. NIC offers unique nickel pure-play exposure via its mining and downstream nickel processing

operations in Indonesia. We forecast attributable EBITDA to grow from ~$240m in FY25 to $550m in FY27 as the company

brings on production from its second mine, Sampala, and grows nickel output from downstream high pressure acid leach

(HPAL) operations. Key takeaways: 1) NIC’s earnings are split fairly evenly between Mining / Pig Iron (Rotary Kiln Electric

Furnaces, RKEF) / HPAL products; 2) despite our relatively flat nickel price outlook, volume growth sees EBITDA grow every

year through the next five years, reaching ~$900m (attributable) in FY31E; and 3) the stock looks significantly undervalued

trading on a P/NPV of 0.6x, with our FY28E EV/EBITDA at 4.3x falling to 2.6x in FY30E.

South32 (Lyndon Fagan) (S32 AU, OW)

4Q26 result - FY26 earnings upgrade on strong realised price/Mozal ally sales; Retain OW

Key takeaways: 1) Quarterly results were stronger than expected, with realised copper pricing and Cannington volume

outcomes ahead of JPMe together with final sales from Mozal (unexpected), this drove a 21%/~$180m upgrade to our FY26

earnings, 2) Volume guidance for FY27 is unchanged, albeit GEMCO now withheld on water management plans – FY26 cost

outcomes have largely netted each other out and our FY27 earnings are broadly unchanged, and 3) There were no major