Stock Name: StraitsAsia
Company Name: STRAITS ASIA RESOURCES LIMITED
Research House: OCBC
Also, with the Queensland flooding highlighting mining risks from adverse weather, investors may be taking comfort that SAR’s production will become more resilient with the addition of Northern Leases after it mentioned in its 3Q results the effects of weather at Sebuku were more severe because operations were confined to the single Tanah Putih pit.
Company Name: STRAITS ASIA RESOURCES LIMITED
Research House: OCBC
Straits Asia (AJ1.SG) is up 7.6% at $2.84 on news of its Northern Leases Principle License, with investors likely anticipating a possible earnings upgrades for FY11 as some analysts had pushed back contribution assumptions from increased Sebuku production due to delays in obtaining the license.
Also, with the Queensland flooding highlighting mining risks from adverse weather, investors may be taking comfort that SAR’s production will become more resilient with the addition of Northern Leases after it mentioned in its 3Q results the effects of weather at Sebuku were more severe because operations were confined to the single Tanah Putih pit.
OCBC, which has a Buy call with $2.89 fair value, says “the Pinjam Pakai permit is typically issued approximately three months after the Principle License is granted, implying that SAR will probably be able to start mining at the Northern Leases by 2Q11-3Q11.”
The house leaves its FY11 estimates unchanged as it had factored in Northern Leases production from 2H11. The orderbook suggests a $2.90 cap.
No comments:
Post a Comment