Pitt Street Research (www.pittstreetresearch.com) – an independent analyst providing issuer sponsored coverage for small to mid cap ASX companies in the Technology and Life Science sectors – have completed an analysis of EcoMag.
In “Specialty chemicals upside – Attractive play on magnesium purity”, they provide a comprehensive overview of the project, drawing attention to particular items of merit:
- An inexhaustible resource with zero exploration risk and a positive environmental outcome.
- Massive scope for expansion at the initial site.
- Good access to critical infrastructure.
- Vertical expansion opportunities into multiple downstream products.
- A wide market across diverse industries.
- Successful pilot plant operation, buyer product testing and off-take agreements.
- Primary approval (mining tenure) in place.
- Northern Australia Infrastructure Facility funding in due diligence.
- A DCF valuation of ~A$347.6m based solely on the initial plant (excluding horizontal and vertical expansion opportunities).
Based on their DCF valuation, Pitt Street Research estimate a value in excess of $3 per share.