In today’s briefing:
- Zijin Mining – Structural Re-Rate Underway; Q3 Results Validate Copper–Gold Flywheel + Spin Unlock
- Larvotto Resources (LRV AU): USAC’s Friendshoring NBIO
- Brent Crude at a New Near-Term Equilibrium?
- Ampol Ltd (ALD) SL Hybrid, Trade the FY25 Disclosure Window
- Fenix Resources (FEX AU) Q1 FY26 Report: Multibagger In The Making
Zijin Mining – Structural Re-Rate Underway; Q3 Results Validate Copper–Gold Flywheel + Spin Unlock
- Earnings momentum accelerating driven by gold volume +20% and mine margin expansion to 60.6%, supported by disciplined cost control and strong operating cash flow.
- Copper–gold dual exposure provides structural upside with spot torque to Cu ~US$10,800/t and Au ~US$4,200/oz, reinforcing earnings visibility into FY26–27.
- Zijin Gold spin-off unlocks value via clean asset separation, improved capital efficiency, and SOTP rerating potential to HK$41–42/sh under spot scenario.
Larvotto Resources (LRV AU): USAC’s Friendshoring NBIO
- In Friendshoring Aussie Rare Earths, I flagged the possibility of the US taking equity stakes in Australian processing projects, as a means towards securing a supply of critical minerals.
- Larvotto Resources (LRV AU), an explorer/evaluator/developer of gold and antimony, has now announced a NBIO from United States Antimony (UAMY US) (USAC) @ A$1.40/share, a 87.67% premium to undisturbed.
- USAC has also declared a 10% holding. An independent board committee is assessing the approach. Due diligence has not yet been granted. That should be forthcoming.
Brent Crude at a New Near-Term Equilibrium?
- Despite underlying bearish fundamentals, crude oil prices are currently finding a floor due to persistent geopolitical risks, creating a unique, range-bound market environment.
- We suggest a strategic approach to navigate this market, focusing on capitalizing on premium capture rather than new strong directional risks amidst conflicting market forces.
- While diplomatic efforts offer potential for de-escalation, the immediate outlook points to stabilized volatility, making specific non-directional strategies particularly attractive.
Ampol Ltd (ALD) SL Hybrid, Trade the FY25 Disclosure Window
- Trade call: Long the 2022 SL hybrid. Price in a likely SPT 1 miss, capture optionality around 101% redemption and the post-disclosure vendor lag.
- Miss risk: F&I intensity must fall about 5.4% from 2024 to meet the 2021 minus 5% SPT. Operational mix makes that hard.
- Catalyst path: Two windows. Pre-disclosure, trade miss probability. Post-disclosure, arbitrage the convergence until data vendors update.
Fenix Resources (FEX AU) Q1 FY26 Report: Multibagger In The Making
- Fenix Resources (FEX AU) reported a substantial increase in shipments, up 155%YoY/17%QoQ, to 885k tons, guiding a further ramp beyond 1 million tons in the December quarter.
- The substantial numbers were followed by yet another share purchase by Chairman Jon Welborn, taking his holding in the company to ~3%.
- Strong operating cashflows of over 43.9 million AUD for the quarter (175 million AUD annualized on a 350 million AUD market cap) could ramp further as Beebyn-W11 shipments increase.
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