Greenland Minerals Limited

GGG Details

Extension of Public Consultation Process: Greenland Minerals Limited (ASX: GGG) is engaged in mineral exploration and project evaluation. The market capitalisation of the company as on 12 March 2021, stood at ~$201.14 million. The company has provided an update on the status of the Kvanefjeld project on 16 February 2021, and informed that the public consultation process that was initiated by the Greenland Government on 18 December 2020 is extended until 1 June 2021.

December 2020 Quarterly Report: During the quarter, the public consultation on the Kvanefjeld project has commenced. On 17 December 2020, the company was advised by the Greenland Government that key documents for a mining license for the Kvanefjeld Rare Earth Project met the required guidelines for public consultation. It completed a successful capital raising, which amounted to ~$34 million, through a share placement and share purchase plan. The cash used in operations during the period stood at $354,000.

December 2020 Quarter Cash used in Operations (Source: Company Reports)

Outlook: The demand for rare earth metals has been increasing, and interest in permanent magnet materials has witnessed a rise in China and international markets. There are decent prospects for the sector as there is increased momentum towards the EV transition. The company believes that it is well-funded to execute pre-development work programs.

Stock Recommendation: The rise in the price of critical magnet rare earths neodymium, praseodymium, terbium, and dysprosium augurs well for GGG, as these are the value drivers of the Kvanefjeld Project. The company reported a high cash cycle of 873.3 days in H1FY20, compared to the industry median of 35.6 days. As per ASX, the stock of GGG is trading below its average 52-weeks’ levels of $0.067-$0.355. The stock of GGG gave a negative return of ~42.59% in the past six months and a negative return of ~36.73% in the past three months. On a technical analysis front, the stock of GGG has a support level of ~$0.143 and a resistance level of ~$0.161. Considering the current trading levels, the absence of revenue generation and catalyst to drive the business growth, high cash cycle days and the key risks associated with the business, we give an ‘Avoid’ rating on the stock at the current market price of $0.155, up by 3.333% as on March 12, 2021.

GGG Daily Technical Chart (Source: Refinitiv, Thomson Reuters)

AML3D Limited

AL3 Details

Business Update: AML3D Limited (ASX: AL3) designs and constructs 3D parts using Wire Additive Manufacturing technology. The market capitalisation of the company as on 12 March 2021, stood at ~$47.23 million. As per a recent update, the company has announced that it will supply a series of industrial components for evaluation and testing to an important 3D Printing Corporation (3DPC) client.

H1FY21 Results Update: The company reported an improvement in sales revenue by ~65% to $143,373 in H1FY21, compared to revenue of $86,999 in the previous corresponding period. However, the net loss widened to $2.05 million during the period, from a loss of $1.83 million in H1FY20. During the December quarter, the company raised $7 million through the issue of ~15.5 million new ordinary shares at an issue price of $0.45 per share.

H1FY21 Financial Performance (Source: Company Reports)

Outlook: The company’s work in hand as on 31 December 2020 includes two ARCEMY 3D Printing Modules, which will be delivered in H2FY21. It anticipates revenue of ~$1 million in relation to these contracts. It plans to expand its contract manufacturing base in the long –term and build on the ARCEMY modules to service customers’ in-house 3D printing needs.

Stock Recommendation: On 02 March 2021, the company has appointed Hamish McEwin as its new Chief Financial Officer. As per ASX, the stock of AL3 is trading below the average of its 52-weeks’ levels of $0.310-$0.730. The stock of AL3 gave a positive return of ~103.22% in the past nine months and a positive return of ~1.61% in the past one week. On a technical analysis front, the stock of AL3 has a support level of ~$0.286 and a resistance level of ~$0.358. Considering the steep movement in price in the past few months, improvement in revenue performance but widening losses and the key risks associated with the business, we are of the view that most of the positive factors have been discounted at the current juncture. Hence, we suggest investors to wait for a better entry-level and give an ‘Expensive’ rating on the stock at the current market price of $0.315 as on March 12, 2021.

 AL3 Daily Technical Chart (Source: Refinitiv, Thomson Reuters)

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