Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Equity Bottom-Up

<ul>
<li>We analyse <a href="https://www.smartkarma.com/entities/champion-iron-ltd" target="_blank" data-smartkarma-citation="entities:19734:1" rel="noopener">Champion Iron (CIA AU)</a> after improvements in its operations in Q2FY26. The company destocked 477k tons and is down to 1.7 million tons to further reduce the stockpile.</li>
<li>The company also saw an improvement in its realized iron ore price (to 128 CAD/ton or 19% YoY) as it reduced its contractual arrangements for material. </li>
<li>Despite the improvement in operational performance, which will drive profitability up 52% YoY, the stock trades at 11.7x FY26 PE and is fairly valued. We prefer <a href="https://www.smartkarma.com/entities/fenix-resources-ltd" target="_blank" data-smartkarma-citation="entities:7405:1" rel="noopener">Fenix Resources (FEX AU)</a> </li>
</ul>


We analyse Champion Iron (CIA AU) after improvements in its operations in Q2FY26. The company destocked 477k tons and is down to 1.7 million tons to further reduce the stockpile.
The company also saw an improvement in its realized iron ore price (to 128 CAD/ton or 19% YoY) as it reduced its contractual arrangements for material. 
Despite the improvement in operational performance, which will drive profitability up 52% YoY, the stock trades at 11.7x FY26 PE and is fairly valued. We prefer Fenix Resources (FEX AU) 


Champion Iron Ore (CIA AU): Fairly Valued Despite Operational Improvements

Derivatives and Quantitative Strategist

Gaudenz Schneider

<ul>
<li>
Context: The <a href="https://www.smartkarma.com/entities/champion-iron-ltd" target="_blank" data-smartkarma-citation="entities:19734:1" rel="noopener">Champion Iron (CIA AU)</a> vs. <a href="https://www.smartkarma.com/entities/stanmore-coal-ltd" target="_blank" data-smartkarma-citation="entities:15252:1" rel="noopener">Stanmore Resources (SMR AU)</a> price-ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.</li>
<li>
Highlights: The trade targets ~12% return to the one-standard-deviation line.</li>
<li>
Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.</li>
</ul>



Context: The Champion Iron (CIA AU) vs. Stanmore Resources (SMR AU) price-ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.

Highlights: The trade targets ~12% return to the one-standard-deviation line.

Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.


Champion Iron (CIA AU) Vs. Stanmore (SMR AU): Coal–Steel Mean Reversion Targeting 12%

Financial News, Analysis and Data, FNArena

FNArena

Financial News, Analysis and Data

Online financial media company focused on Australian equities, with a global perspective

<ul><li>Rising costs and weak pricing weighed on first quarter earnings for Champion Iron, but development projects remain on course to support growth.</li><li> -Champion Iron&rsquo;s first quarter production and earnings disappoint -Record sales, but rising costs and lower realised pricing -Capex projects on track, liquidity expected to improve -Improving balance sheet, but still sensitive to commodity prices</li></ul>

Rising costs and weak pricing weighed on first quarter earnings for Champion Iron, but development projects remain on course to support growth. -Champion Iron&rsquo;s first quarter production and earnings disappoint -Record sales, but rising costs and lower realised pricing -Capex projects on track, liquidity expected to improve -Improving balance sheet, but still sensitive to commodity prices

Can Champion Iron Deliver On Growth Projects?

<ul>
<li>We summarize our gleanings from the <a href="https://www.smartkarma.com/entities/champion-iron-ltd" target="_blank" data-smartkarma-citation="entities:19734:1" rel="noopener">Champion Iron (CIA AU)</a> presentation, which captures the cost curve and other interesting details on the DRI market. </li>
<li>After declining below 100 USD/ton for 2 weeks, iron ore prices have slowly inched up towards 100 USD/ton, maintaining their level at the high end of the cost curve. </li>
<li>A 100 USD/ton level bodes well for the cash flows of the larger low-cost players like <a href="https://www.smartkarma.com/entities/vale-sa" target="_blank" data-smartkarma-citation="entities:23731:1" rel="noopener">Vale (VALE US)</a>, <a href="https://www.smartkarma.com/entities/rio-tinto-ltd" target="_blank" data-smartkarma-citation="entities:13:1" rel="noopener">Rio Tinto Ltd (RIO AU)</a>. </li>
</ul>


We summarize our gleanings from the Champion Iron (CIA AU) presentation, which captures the cost curve and other interesting details on the DRI market. 
After declining below 100 USD/ton for 2 weeks, iron ore prices have slowly inched up towards 100 USD/ton, maintaining their level at the high end of the cost curve. 
A 100 USD/ton level bodes well for the cash flows of the larger low-cost players like Vale (VALE US), Rio Tinto Ltd (RIO AU). 


Champion Iron Presentation, Iron Ore Cost Curve, and The Case For Green Steel

<ul>
<li>Following our initiation on <a href="https://www.smartkarma.com/entities/mount-gibson-iron-ltd" target="_blank" data-smartkarma-citation="entities:19043:1" rel="noopener">Mount Gibson Iron (MGX AU)</a> and <a href="https://www.smartkarma.com/entities/kumba-iron-ore-ltd" target="_blank" data-smartkarma-citation="entities:25094:1" rel="noopener">Kumba Iron Ore (KIO SJ)</a>, recently we initiate coverage on <a href="https://www.smartkarma.com/entities/champion-iron-ltd" target="_blank" data-smartkarma-citation="entities:19734:1" rel="noopener">Champion Iron (CIA AU)</a>, a pure play with Canadian assets.</li>
<li>Although it is more richly priced than the other two names, it offers a 50% volume expansion opportunity in FY25/26, subject to financing availability. </li>
<li>Trading at 8.6x FY25 (March-end) PE, 4.6x EV-EBITDA, and a 6% dividend yield (subject to capex), this is not our favorite name at the current price due to production uncertainty. </li>
</ul>


Following our initiation on Mount Gibson Iron (MGX AU) and Kumba Iron Ore (KIO SJ), recently we initiate coverage on Champion Iron (CIA AU), a pure play with Canadian assets.
Although it is more richly priced than the other two names, it offers a 50% volume expansion opportunity in FY25/26, subject to financing availability. 
Trading at 8.6x FY25 (March-end) PE, 4.6x EV-EBITDA, and a 6% dividend yield (subject to capex), this is not our favorite name at the current price due to production uncertainty. 


Champion Iron (CIA CN): Another Expansion Iron Ore Pure Play on High-Grade Ore

Australia

champion Iron Limited is a exploration company. The Company acquires, explores and develops properties for iron ore deposits.

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Champion Iron (CIA AU)

Champion Iron Ore (CIA AU): Fairly Valued Despite Operational Improvements

Champion Iron (CIA CN) has seen a dramatic turnaround in its operations. We discuss its prospects, Q2 results, and its valuation and contrast it...

Sameer Taneja