We initiate a BUY rating on CNMC Goldmine (SGX:5TP) with a target price of S$0.43, pegged to a blend of 12.2x FY24F P/E (peers average) and DCF.
CNMC Goldmine is a prime beneficiary of rising gold prices amidst global uncertainties and increasing demand for the safe-haven asset. Gold prices rose 26% in 2024 and remain elevated at an all-time high US$2,880/oz in Feb’25. The company has diversified into lead and zinc and expects increased gold production capacity from the first half of 2025.
- Read this at SGinvestors.io -
Sky-high gold prices to boost bottom-line.
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Demand for gold was boosted by factors including central bank purchases, geopolitical tensions, interest rate cuts and a hedge against inflation. Average gold prices have risen from US$1,960/ oz in 2023 to US$2,266/oz in the first half of 2024, closing at US$2,624/oz at the end of the year.
CNMC Goldmine's 1H24 net profit has already soared 160% y-o-y and we continue to expect higher gold prices to contribute significantly towards its bottom-line.
Expansion of gold production capacity by 2025.
Read more at SGinvestors.io.
Above is an excerpt from a report by Lim & Tan Securities Research. Clients of Lim & Tan Securities may be the first to access the full PDF report @ https://www.limtan.com.sg/.
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