Mid-Cap

Drop in Newcrest Mining and Syrah Resources

June 20, 2016 | Team Kalkine
Drop in Newcrest Mining and Syrah Resources

Newcrest Mining Limited



NCM Details
  • Falling gold prices dampened the stock sentiment: Newcrest Mining Limited (ASX: NCM) stock fell over 2.5% on June 20, 2016 due to fall in gold prices on easing fears over Brexit. On the other hand, NCM reported that its Mining restarted at the Kencana mine, a part of the Gosowong operation. The group’s production at its core assets- Lihir, Cadia and Golpu are also witnessing organic growth. NCM is still among low cost producers with a solid reserve life.
  • Recommendation: We maintain a “Hold” on the stock at the current price of $21.85
 

NCM’s cost competitiveness (Source: Company Reports)
 
Syrah Resources Ltd



SYR Details
  • Finished capital raising: Syrah Resources Ltd (ASX: SYR) fell over 0.78% on June 20, 2016. The group finished the placement of its 32 million new fully paid ordinary shares to raise over A$194 million of capital. The group intends to use these proceeds to finish development of its Balama Project (including working capital requirements) as well as to fund its general and administrative cost requirements. This capital raise would also enhance its balance sheet flexibility and enable the group’s efforts on its spherical graphite strategy in response to major market.
  • Recommendation: Given the project prospects ahead, we give a “Hold” on the stock at the current price of $6.35

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