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Consensus community valuation
$0.810
Average Intrinsic Value
32.8%
Undervalued by
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#Bull Case
Last edited 2 months ago

CAI has a good little asset that will have an initial 6yr mine life but likely to be 10yr+ with a little exploration success along strike and at depth. Bull market in AUD gold should see favourable funding outcomes achieved. The ASX's sub 150koz p.a. cohort has been very hit and miss in the last 5 years so management is going to be key. Team is good overall and lead by an MD that did the feasibility and project dev work on 2 of Africa's largest platinum mines (Zimplats, Afplats mines) which are successful producing mines to this date still. Feasibility should be highly robust and accurate thus I consider the likelihood the feasibility will be gamed or BS as low. DFS due 4Q CY20 and is devised from bankable quotes, thus once it is done, and funding is secured, ground can be broken asap. Little downside from here as NPV is $0.30 at USD1250/oz on a fully diluted basis. Upside ranges from +0% to +500% on scenario analysis, with base case at ~200% for now (USD1700/oz for 6 years producing from CY22).

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#ASX Announcements
Added a week ago

1 July 2020

Major tenders issued and debt advisor appointed

Definitive Feasibility Study on track for completion this quarter

HIGHLIGHTS

•Key preparations now being made to ensure construction of the Warrawoona Gold Project in the Pilbara starts in 2021

•Tenders issued for Open Pit Mining, Tailings Dam Construction, Processing Plant Construction and Power Station Construction contracts

•Telstra awarded scope of works to establish communication backbone to site

•Initial scope of work awarded for Design and Certification of Village installation

•Argonaut appointed as Debt Advisor

 

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for full announcement

http://www.aspecthuntley.com.au/docserver/02250062.pdf?fileid=02250062&datedir=20200701&edt=MjAyMC0wNy0wMiswOToyMjoxOCs0ODArMTAxNTcxMSthbmRyZXd3ZXN0K3JlZGlyZWN0K2h0dHA6Ly93d3cuYXNwZWN0aHVudGxleS5jb20uYXUvaW1hZ2VzaWduYWwvZXJyb3JwYWdlcy9wZGZ0aW1lb3V0Lmh0bWwraHR0cDovL3d3dy5hc3BlY3RodW50bGV5LmNvbS5hdS9pbWFnZXNpZ25hbC9lcnJvcnBhZ2VzL3BkZmRlbGF5ZWQuanNw

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#Business Model/Strategy
Added a month ago

Announced a JV for nearby tenements. Prospective for copper/gold porphyry type targets with interesting historical workings. Cheap option for the company to progress. Outside of that, resource update due June 2020 qtr and DFS still on track for Sept 2020 qtr. Remains a compelling little gold developer in a gold bull market. The stock will go up a lot more all else equal.

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