KEFI Minerals - about to rip? The HotStockRockets team writes...

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KEFI Minerals (KEFI) recently updated on its flagship Tulu Kapi gold project including that prospective Ethiopian private sector investor ANS Mining “has not met the published deadline of 30 June 2020 for making its initial investment”. So why currently a share price rise, back above 1p?...

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The project company has served notice that it may replace ANS either in part or in full with other investors despite ANS “continues to affirm a strong interest in making an investment” – that with the project having “received significant interest to provide the outstanding asset level equity and other forms of duly subordinated investment, not only from other domestic investors, but also from international specialist mining financiers”. In short, the ANS missed deadline looks to have come at an opportune time for KEFI – with a positive gold environment and now in a position to negotiate in this environment. It particularly notes looking to increase funds raised from specialist mining financiers (that is to say streaming companies), enabling it to increase its beneficial interest in the project above a previously anticipated 45%.

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KEFI Executive Chairman Harry Adams emphasises “the project must and will keep moving forward given that the other shareholders… are already actively deploying funds and because of its prominence and importance in the burgeoning Ethiopian mining sector”. This is supported by that potential new investors were introduced not only by KEFI but also by the Ethiopian Government, noted to “to ensure the required project equity is secured well in advance of the closure of the full financing package in October 2020”.

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There though currently remains clear financing risk, though the above encourages and the company has previously emphasised for a 45% beneficial interest in Tulu Kapi, even at $1,300 gold a Net Present Value (at an 8% discount rate) of the current project of $93 million (currently approx. £74.6 million). That compares to a still below £19 million market cap, despite also currently above $1,750 gold and with also apparent Hawiah more valuable metal content and ongoing exploration potential. With also the upcoming Tulu Kapi potential catalysts – Adams looking “forward to updating shareholders in the current quarter”, we continue to target more than 3p here and thus our stance remains Buy.

This article first appeared on HotStockRockets – for a new hot share tip from the HotStockRockets team JUST OUT THIS AFTERNOON for just £5.50 click HERE

Filed under: KEFI Minerals, AIM darling, Ryanair, Remote Monitored Systems, Fyooz, HotStockRockets

2020-07-10 13:36:13

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