First Read Genesis Minerals: The regional play

研报英文原文证据摘录

First Read Genesis Minerals: The regional play

Forecast returns

Forecast price appreciation 59.8%

Forecast dividend yield 0.0%

Forecast stock return 59.8%

Market return assumption 9.5%

Forecast excess return 50.3%

Company Description

Genesis Minerals (GMD.AX) is a Western Australian-based gold producer with a well-

regarded management team (largely ex-Saracen). GMD have a target to reach 400kozpa of

gold production this decade. Gold production for GMD will come from their Leonara and

Laverton plants fed from various ore sources across the region.

Valuation Method and Risk Statement

GMD: Our price target is based on DCF with a 6% WACC and a US$3,250/oz long-term gold

price. Investment risk inherent in the resource sector includes, but is not limited to movement

of commodity price and currency which may differ materially from the assumptions used in

this report. Furthermore, the sector is subject to political, financial and operational risks, each

of which has the potential to significantly impact industry performance. Mid/small cap gold

miners have added volatility in reserve extension risks. GMD have the added risk of project

growth and delivery, in particular due to the age of their assets (Gwalia). Risks beyond the

base case to our forecasts include delays to production ramp up, delivery and potential cost

escalation in late stage delivery.

VAU: Our price target is based on DCF. Investment risk inherent in the resource sector

includes, but is not limited to movement of commodity price and currency which may differ

materially from the assumptions used in this report. Furthermore, the sector is subject to

political, financial and operational risks, each of which has the potential to significantly

impact industry performance.