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Highlights

  • Canaccord Genuity analyst Reg Spencer issued a Buy rating on Iluka Resources (ASX: ILU) with a price target of AUD 6.15.

  • The target represents a 10.81% upside from the current share price of AUD 5.43.

  • Iluka recently announced suspension of operations at Cataby mine and Synthetic Rutile Kiln 2 (SR2) due to subdued demand.

  • Despite near-term market challenges, Iluka maintains a resilient EBITDA margin of 39% and continues advancing its Balranald and Eneabba projects.

Iluka Resources Ltd (ASX:ILU), a leading Australian producer of mineral sands, has received a Buy rating from Canaccord Genuity. Analyst Reg Spencer set a price target of AUD 6.15, reflecting a potential upside of more than 10% against the latest closing price of AUD 5.43.

The recommendation comes at a time of transition for Iluka, which recently announced that it would suspend production at its Cataby mine and Synthetic Rutile Kiln 2 (SR2) in Western Australia. The suspension, effective from 1 December 2025, is expected to last up to 12 months for Cataby and six months for SR2, with the company citing subdued global demand for mineral sands and pigment products.

Iluka emphasised that it has sufficient inventories of synthetic rutile and chloride ilmenite to meet customer commitments. The company added that both operations would restart once market conditions improve.

Strategic Projects on Track

Despite the suspension at Cataby, Iluka continues to progress with its growth and diversification pipeline. The Balranald project in New South Wales remains on schedule, with mining expected to commence in the fourth quarter of 2025. Meanwhile, construction of the Eneabba rare earths refinery is advancing as planned.

Production at Iluka’s Jacinth-Ambrosia mine in South Australia continues unaffected,.

Interim Results

In its half-year results for 2025, Iluka reported mineral sands revenue of AUD 558 million and a resilient EBITDA margin of 39%. Net profit after tax came in at AUD 92 million, while net debt stood at AUD 164 million (excluding non-recourse debt).

Safety metrics also improved, with a Total Recordable Injury Frequency Rate of 3.7, down slightly from 3.8 in FY2024. Importantly, the Serious Potential Incident Frequency Rate halved to 1.5, compared with 3.3 in the prior year.

Shareholders were rewarded with an interim dividend of 2 cents per share, fully franked.