Magnis Resources Ltd

MNS Details
·         Positive sector trends: Magnis Resources Ltd (ASX: MNS) stock rallied over 5.5% on May 17, 2017 with sector-driven gains after falling over 20.3% in the last four weeks (as at May 16, 2017). Moreover, the global graphite market is gradually showing promising prospects and is forecasted to reach $18,769 million by 2022 (Allied Market Research), representing a CAGR of 5.4% during the forecast period 2014 to 2022. The group had earlier signed an MOU with ROSATOM for project finance and got SEZ License in Tanzania.  MNS also made an MOU for battery plant manufacturing plant in Townsville, Australia, executed with a global consortium Corporate. The group has a cash position of A$1.54M for the Company as at 31 March 2017.

·         Recommendation: We maintain a “Buy” recommendation on the stock at the current price of $ 0.58

Vocus Group Ltd

VOC Details
·         Recovering stock sentiment: Vocus Group Ltd (ASX: VOC) stock recovered over 4.3% on May 17, 2017 after falling over 24% in the last four weeks (as at May 16, 2017). The group got embattled at the back of the downgrade of their FY17 Underlying NPAT, which is now forecasted in the range of ~$160-165m as compared to earlier guidance of $205-215m. The net debt as at 30 June 2017 will now be $1-1.1bn in FY17. Net leverage is forecasted to be ~2.6x vs covenant of 3.5x. On the other hand, the cumulative run rate of acquisition synergies is expected to reach $57m in line with guidance.

·         Recommendation: Although Vocus still seems to be a long-term potential telecom player (with valuable network), we believe that it might be prudent to wait till the time the group starts showing some signs of recovery post the latest loss, and maintain a “Hold” recommendation on the stock at the current level of $ 2.45

Resolute Mining Limited

RSG Details
·         Boost from gold prices: Resolute Mining Limited (ASX: RSG) stock rallied over 4.7% on May 17, 2017 driven by the gold prices rally. The group updated their guidance to 325koz at US$865/oz in FY17 as compared to earlier guidance of 300koz at US$934/oz. The group’s Syama Gold Mine has 12 years of life and is targeting up to 250kozpa at AISC of US$881/oz. For Ravenswood Gold Mine, the group is targeting up to 140kozpa at AISC of US$880/oz.

·         Recommendation: Though there seems to be a temporary positive momentum, volatile conditions in the sector may still prevail. Given the potential and trading scenario,we maintain our “Expensive” recommendation at the current price of $ 1.21

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