4 Resources Stocks under Investors’ Radar- G6M, GLA, AUZ, IND

Group 6 Metals Limited (ASX: G6M)

G6M is an Australian company indulged in mining and exploration of Tungsten. Its projects involve 100% owned - Dolphin Tungsten Mine. As of 9^th February 2022, the company’s market capitalisation stood at AUD 97.76 million.

Operational Updates:

• The Dolphin project is located in King Island, Tasmania and it is a host of highest-grade tungsten deposit of significant size in the western world. It got its approvals and the construction started on 26^th January 2022.
• As per 19^th January 2022 update, its fully funded and 100% owned - Dolphin Tungsten Mine Project is well placed to commence its commissioning in the late CY22 or early CY23, followed by first shipment of tungsten concentrate in 1QCY23.
• In the month of January 2022, the company appointed Mr Keith McKnight and Ms Megan Mc Pherson as Chief Executive Office and Chief Financial Officer, respectively.
• As per quarterly update on 25^th January 2022, Tasmanian Government provided a grant of ~AUD 2 million for upgrading Dolphin Mine’s capacity and G6M’s extensive licenses are planned for 1Q/2Q 2022.

2QFY22 and Annual Financials: With the nil cash receipts, G6M’s net cash outflow from operating activities were ~AUD 1.48 million and closed its second quarter (2QFY22) with a cash balance of ~AUD 36.05 million as of 30^th December 2021 versus ~AUD 4.04 million posted in last quarter. As per the Annual Report, the company reported an increase on Y-o-Y in its other income from ~AUD 203k in FY20 to ~AUD 223k in FY21. It had posted a net loss of ~AUD 4.87 million in FY21.

Technical Analysis: On a daily chart, G6M stock prices are sustaining above the trend-following indicators 21-period SMA and 50-period SMA, taking the support of the same and indicating a possible bullish uptrend. The momentum oscillator RSI (14-period) is trading at ~51.516, supporting the bullish momentum. An important support level for the stock, is placed at AUD 0.135 while the key resistance level is placed at AUD 0.170.

On the basis of update on upcoming commissioning in its Dolphin Project and technical levels, keeping the support and resistance level as crucial points, investors with a high-risk appetite might consider a ‘Speculative Buy’ position. The stock was analysed as per the closing price of AUD 0.150, down by ~3.226%, as of 9^th February 2022. However, the risk levels are high depending on the timely commencement of the commissioning and future findings saleability.

Daily Technical Chart – G6M

Source: REFINITIV

Gladiator Resources Limited (ASX: GLA)

An Australian company, GLA is involved in exploration and mining of projects like Marymia Gold Project, Rutherglen Gold Project and Bendoc Gold Project. Listed in 2006, its market capitalisation stood at AUD 13.80 million as of 9^th February 2022,

Operational Updates:

• As per quarterly update on 31^st January 2022, the company completed its 13 holes RC (Reverse Circulation) drilling at Bendoc Gold Project and found significant results of Au(g/t) covering 1146 metres.
• With the completion of ground magnetic survey at Rutherglen Gold Project, its low impact exploration plan is due in 1QFY22.
• 417-line km of ground radiometric traverses were completed, and numerous radiometric anomalies were found at Minjingu Uranium and Phosphate project.
• As per 17^th January 2022 announcement, GLA raised ~AUD 1.2 million through share placement, which is to be used for progressing Tanzanian Uranium projects and Victorian Gold projects.

Financial Highlights:

• 2QFY22: For its second quarter, the company recorded its cash receipts as nil and closed the quarter with a cash balance of ~AUD 1.16 million at the end of 30^th December 2021 versus ~AUD 1.48 million at the end of 30^th September 2021.
• FY21: The net losses after tax were reduced from AUD 1.12 million in FY20 to AUD 309.9k in FY21.

Technical Analysis: On the daily chart, GLA stock prices are sustaining below the downward sloping trendline resistance and facing the resistance of the same. The momentum oscillator RSI (14-period) is trading at ~42.17 level, indicating lack of strength in the prices. Moreover, prices are trading below the trend-following indicators 21-period SMA and 50-period SMA, which may act as a resistance zone. An important support level for the stock, is placed at AUD 0.024 while the key resistance level is placed at AUD 0.030.

Considering stock’s current low momentum movement, supported by low volumes and its subdued financials, investment in the scrip should be taken with extra precautions, hence a ‘Watch’ stance is suggested. The stock was analyzed as per the closing price of AUD 0.0027 per share, as of 9^th February 2022.

Daily Technical Chart – GLA

Source: REFINITIV

Australian Mines Limited (ASX: AUZ)

Listed in 2001, AUZ is an Australian involved in catering electric vehicle (EV) and energy storage industries by producing and supplying technology metal materials. It is also engaged in the development of Cobalt-Nickel-Scandium Projects in Australia. As of 9^th February 2022, its market capitalisation stood at AUD 82.84 million.

Operational Updates:

• On 9^th February 2022, its wholly owned subsidiary Sconi Mining Operations signed a compensation agreement related to Greenvale mining lease (ML application 10368) with the underlying private landholder of Lucky Downs station.
• On 4^th February 2022, PQ Partners were appointed as strategic advisers for its on-going flagship project Sconi Cobalt-Nickel-Scandium Project in North Queensland.
• On 3^rd February 2022, it received a tax offset refund of ~AUD 409,325 related to R&D for FY21 from Australian Taxation Authority (ATO).

2QFY22 Financials Update: As per its 2QFY22 Quarterly Report released on 31^st January 2022, its Pilot production plant commenced its operations and successfully produced (NCM) 90/05/05 P-CAM and lithiated cathode active material (CAM) in December 2021. Its cash receipts from customers were nil and closed the 2QFY22 with a cash balance of ~AUD 5.74 million at the end of 30^th December 2021 versus ~AUD 7.27 million at the end of 30^th September 2021.

Technical Analysis: AUZ's prices are sustaining below an upward sloping trend line breakout level for the past couple of weeks, indicating a downside direction for the stock. On the weekly chart, the trend-following indicators 50-period SMA and 21-period SMA are placed above the CMP and may act as the resistance levels. The leading indicator RSI (14-period) is hovering around mid-point and currently trading at ~44.05 levels. Now the next important support level for the stock is at AUD 0.170, while resistance is at AUD 0.210 level.

Due to stock’s movement below the upward sloping trend line breakout level and current indecisiveness RSI is creating, a ‘Watch’ stance is suggested. The stock was analyzed as per the closing price of AUD 0.190 per share, down by ~1.299%, as of 9^th February 2022.

Weekly Technical Chart – AUZ

Source: REFINITIV

Industrial Minerals Limited (ASX: IND)

IND is a mining company in Australia which explores and develops industrial minerals, including gypsum and salt, silica sand, construction sand and aggregates. Its projects are: Quins Project, Unicup Project and Lake Macleod Project., Turner River Project, Karratha Project, Roebourne Project, Cataby West Project, Mullering Project, Jurien Project, Gingin Project and Regans Ford Project.  As of 9^th February 2022, its market capitalisation stood at AUD 15.13 million.

2QFY22 Update:  As per its 2QFY22 Quarterly Report released on 31^st January 2022, targeting High purity silica sands, IND carried its low impact mining strategy and some positive test work results were found in soil sampling from drilling of 997 metres at its Stockyard project. It appointed:

• GM for marketing in December 2021.
• Global standards for ESG reporting
• Scandinavian alliance in order to give better exposure to international investors

Its cash receipts from customers were reported as nil and closed its second quarter for FY22 with a cash balance of ~AUD 4.06 million at the end of 30^th December 2021 versus ~AUD 4.47 million at the end of 30^th September 2021.

Technical Analysis: IND's prices recently tested a crucial resistance level of AUD 0.260 but were unable to break this level, indicating the possibility of a downside correction. On the weekly chart, prices are also facing resistance from the trend-following indicator 21-period SMA, further supporting a negative bias. However, the leading indicator RSI (14-period) is recovering from lower levels and currently trading at ~46.53 levels. Now the next important support level for the stock is at AUD 0.220, while resistance is at AUD 0.270 level.

The resistance faced by IND and its current technical levels might portray an unappealing time to enter at such price levels, hence a ‘Watch’ stance is suggested. The stock was analyzed as per the closing price of AUD 0.245 per share, up by ~2.083%, as of 9^th February 2022.

Weekly Technical Chart – IND

Source: REFINITIV

Note 1: The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decisions should be made depending on the investors’ appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest. 

The Green colour line reflects the 21-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period, then it shows prices are currently trading in a bullish trend, (Vice – Versa).

The Blue colour line reflects the 50-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 50-period, then it shows prices are currently trading in a bullish trend, (Vice – Versa).

The Yellow colour line reflects the Trendline, which shows whether the direction of the scrip is upwards or downwards.

The Purple colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

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