Syrah Resources Ltd (ASX: SYR)

SYR Details

First Production of graphite from Balama: Graphite miner and technology company, Syrah Resources gained a lot of momentum during this year and lately announced for the first production of bagged saleable flake graphite from its Balama Project in Mozambique. It is worth noting that the flake graphite grade has been in excess of 95% fixed carbon. The group has completed major project construction works and construction activities are now only limited to electrical and instrumentation works, completion of construction punch list items and verification checklists for the fines circuit. SYR has also indicated that costs of Balama production offset by any revenue received during the commissioning phase will be capitalised on the balance sheet until commercial production is declared.

The stock price is around its highest since August 2016 and the group expects more momentum at Balama project, which is said to become the leading global producer of high purity graphite. We give a “Hold” on the stock at the current price of $4.39
 

Resources Overview (Source: Company Reports)
 

Mineral Resources Ltd (ASX: MIN)

MIN Details

Encouraging Outlook: Mineral Resources’ stock rallied 7.9% on November 24, 2017 at the back of continued positive momentum post the release of its Managing Director’s Presentation that emphasized on group’s strong result and buoyant outlook, and commodity price movement. The group’s FY17 reporting revenue of $1.46bn represented a growth of 24% while NPAT surged 83%. MIN will be maintaining a minimum EBITDA of $500m for FY18 with support from 130Mt equivalent crushing capacity, 13.3Mt iron ore exported, 4.50 – 4.75Mt lithium DSO exported, and 450Kt spodumene exported. The group’s capital expenditure has been forecasted to be between $300m and $350m. In FY18, MIN would add a 15-20Mtpa new contract crushing capacity and work on new haulage fleet. FY18 planned commodity production also looks encouraging. At Wodgina, MIN has planned construction of 50Ktpa lithium carbonate plant in 2 modules which will commence in July 2018 with commissioning during quarter 2 CY20. Partnership with Hazer for graphite production is also tracking well. However, the stock is already at high levels and we maintain an “Expensive” recommendation at the current price of $20.23

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