In today’s briefing:
- Global Lithium (GL1 AU): Titan’s Binding Scheme, an Uncertain MinRes Vote
- ITMG Vs PTBA: The Cheapest Way to Indonesian Coal Exposure
- Kinross Gold Corporation (TSX: K; NYSE: KGC): Record Margins Fund Buybacks and a Grade-Led Pipeline
- SLB’s Data Center Revenue Jumps 80% — Can The Business Reach $2 Billion By 2027?
- Iron Ore’s GWH Restocking Is Back in Play, But Mill Margins Lag
- Ecolab’s CoolIT & Ovivo Expansion Unlocks A Bigger Data Center Infrastructure Opportunity!
- Dyno Nobel Blasting Into Defence Earnings
- Morning Market Notes: A U.S.-Iran Deal in the Making at the UN? We Are Still Not Holding Our Breath
- Oil futures: Brent tests $100/b as supply concerns ease
- Fenix Resources Ltd (FEX AU): Updates Post The FY26 Result
Global Lithium (GL1 AU): Titan’s Binding Scheme, an Uncertain MinRes Vote
- Global Lithium Resources Ltd (GL1 AU) entered into a scheme implementation deed with Titan at A$1.15 per share, a 72.9% premium to the undisturbed price.
- Regulatory approvals (FIRB, ACCC) are low-risk. Barring Mineral Resources (MIN AU), there is little doubt that the remaining substantial shareholders will be supportive.
- While MinRes will crystallise a material loss at the offer price, it is unlikely to interfere, as it recently stated that it does not want further exposure to lithium.
ITMG Vs PTBA: The Cheapest Way to Indonesian Coal Exposure
- Indonesian thermal coal prices are trending higher, creating a constructive cyclical backdrop for domestic coal producers: Indo Tambangraya Megah (ITMG IJ) & Bukit Asam (PTBA IJ)
- Indo Tambangraya Megah (ITMG IJ) combines the lowest valuation with substantial net cash, while Bukit Asam (PTBA IJ) combines stronger observed cash conversion with deeper logistics and resource-duration advantages.
- We test, through a forensic examination of business economics and a value-investing lens, which company, if either, can offer more than 25% upside from current prices.
Kinross Gold Corporation (TSX: K; NYSE: KGC): Record Margins Fund Buybacks and a Grade-Led Pipeline
- High-margin leverage to gold: FY25 revenue rose 37% to US$7.05bn while production cost per ounce rose 12%, lifting cash margin to US$2,285/oz.
- Organic pipeline extends the profile: Phase X, Curlew and Redbird 2 start in 2028; Great Bear (late 2029) and Lobo-Marte add ~850koz/yr of high-grade ounces to the existing 2 Moz.
- Valuation: 9.4x FY26E P/E and 5.1x EV/EBITDA with FY25 ROCE 29.8%; US$1.9bn net cash
SLB’s Data Center Revenue Jumps 80% — Can The Business Reach $2 Billion By 2027?
- Schlumberger Limited reported second-quarter 2026 revenue of $9 billion, up 3% sequentially as international growth and a North American rebound offset Middle East weakness.
- Middle East revenue declined 13% sequentially to $1.66 billion because of regional conflict and security disruptions, particularly in Iraq.
- Management expects activity to recover gradually, although the pace will vary by country and customer.
Iron Ore’s GWH Restocking Is Back in Play, But Mill Margins Lag
- Elevated portside inventories and a fresh WoW increase suggest Golden Week restocking has yet to translate into meaningful inventory drawdowns.
- Options positioning is turning increasingly constructive, with call OI building at strikes 105 and 110. OI PCR of 0.61 reinforces the bullish bias.
- Managed money extended its bearish positioning for a 12th straight week, trimming long exposure by ~4% while increasing short positions by ~3%.
Ecolab’s CoolIT & Ovivo Expansion Unlocks A Bigger Data Center Infrastructure Opportunity!
- Ecolab reported a second quarter characterized by continued organic sales growth and margin stabilization despite challenging commodity cost inflation.
- Adjusted earnings per share increased by 11%, supported by 5% organic sales growth, stable organic gross margins, and productivity gains.
- Pricing actions, including a newly implemented global energy surcharge, contributed to a 4% price increase in the quarter, with expectations for pricing to strengthen to 5-6% in the second half of 2026.
Dyno Nobel Blasting Into Defence Earnings
- The strategic repositioning of Dyno Nobel ((DNL)) is the key takeaway from last week’s Investor Day, titled “Beyond FY28 $600m EBIT Ambition”.
- Management signalled its longer-term growth ambitions for the explosives company, laying out not only an upgraded FY28 EBIT target, but also an FY31 EBIT goal of $800m, compared to FY26 EBIT of between $480m-$490m.
- The market was happy to cheer the update, sending the share price up almost 8%, which is impressive given the rally off the late March low of some $2.88 to currently around $4.10.
Morning Market Notes: A U.S.-Iran Deal in the Making at the UN? We Are Still Not Holding Our Breath
- In his speech to the U.N. General Assembly, President Trump stated that a “deal” with Iran could be made after the U.S. midterm elections.
- This suggests to us that there remains the possibility of the U.S. launching a major strike, perhaps on Pickaxe Mountain, before the midterms, as we previously discussed.
- Such an attack might satisfy the domestic base and yet allow President Trump to offer some form of “carrot” to Iran after the midterms to achieve his “off ramp.”
Oil futures: Brent tests $100/b as supply concerns ease
- Crude oil futures dropped for a fourth straight session on Monday, as expectations that Saudi Arabia could soon restore some flows through its damaged East-West Pipeline eased concerns over supply disruptions.
- Nov26 ICE Brent futures were 3.6% lower at $100.11/b (2119 BST), while Nov26 NYMEX WTI was at $92.04/b , down 4.2% versus Friday’s settle.
- Brent earlier traded at an intraday low of $98.98/b, dropping below $100/b for the first time in two weeks.
Fenix Resources Ltd (FEX AU): Updates Post The FY26 Result
- FY26 delivered the promised step change: shipments rose 83% to 4.4Mt, revenue rose 87% to A$590m, with C1 held at A$73.7/wmt amid peer double-digit inflation.
- Beebyn Hub transition is on schedule, with the owner-operated crusher due in Q2 FY27 and FY27 guidance of 4.7Mt to 5.3Mt reaffirmed.
- FY26 prints 15.0x earnings, 2.9x EV/EBITDA and 3.9% yield, stepping to 9.4x and 1.9x on 06/27e.
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