Nova Minerals Limited

NVA Details

Higher Grade Gold Identified at Korbel: Nova Minerals Limited (ASX: NVA) is an exploration company focused on gold exploration in the Tintina Gold Province in Alaska. The company is currently conducting an infill drilling program to grow its Korbel Main deposit, which is within NVA’s flagship Estelle Gold Project. In a recent update, NVA notified that the results of the infill drilling have confirmed continuity of mineralisation within the 4.7Moz Korbel Main Resource. The latest results demonstrated that the Korbel Main deposit has a significant scale with high-grade “blow out” zones within the continuous mineralisation.

June 2021 Quarter Highlights:

• During the June 2021 quarter, NVA continued its drilling program at Korbel Main, and commenced a drilling program at RPM.
• NVA has commissioned a Prep Lab, which will be run by independent contractors. This will help in increasing efficiency and reducing expenses.
• Over the quarter, NVA updated on the Thompson Brothers project resource upgrade. The Indicated Resource Estimate now stands at 9.08 Mt @ 1.00% Li2O, and Inferred Resource Estimate is 1.97 Mt @ 0.98 % Li2O for less than 5% of the project area.
• At the end of the June 2021 quarter, the company had a cash balance of $15.5 million.

Cash Balance Trend (Source: Analysis by Kalkine Group)

Key Risks: NVA is exposed to the risks related to the fluctuations in the gold price as it could impact its financials. NVA is also exposed to the risks associated with changes in the mining regulatory regime governing the company and its projects.

Outlook: Looking ahead, the company is focused on growing its global resource inventory while advancing the Korbel project. It intends to ramp up future operations in short order across the Korbel Valley and the wider Estelle Gold District.

Stock Recommendation: The stock has provided a return of ~20.83% in the last one month and ~110% in the last one year. The stock has 52-week high and low price of $0.063 -$0.235. On the technical analyses front, the stock has a support level of ~$0.10 and resistance of ~$0.15. On a TTM basis, the stock is trading at a price to book multiple of 4.0x, higher than the industry median of 2.7x, demonstrating that the stock is overvalued. Considering the stock’s decent returns in the last one month, valuation on TTM basis, and uncertainty surrounding the impact of COVID-19 pandemic, we suggest investors to book profit and give a “Sell” rating on the stock at the current market price of $0.145, as on 3 September 2021, 2:31 PM (GMT+10), Sydney, Eastern Australia.

NVA Weekly Technical Chart, Data Source: REFINITIV

Stavely Minerals Limited

SVY Details

Change of Directors’ Interest: Stavely Minerals Limited (ASX: SVY) is an exploration company with assets, the Stavely, Yarram Park and Ararat Projects, located in western Victoria in Australia. The company is mainly focused on the exploration copper. Recently, one of the company’s Directors, Robert Dennis, acquired 444,444 shares of the company for a total consideration of $192,684 via on-market purchase.

High-Grade Assay Results at Cayley Lode: The results from the ongoing resource drilling program within the high-grade Cayley Lode discovery at the Thursday’s Gossan prospect, have reported significant intercepts below the low-angle structure, confirming an apparent southerly plunge to the Cayley Lode.

June 2021 Quarter Highlights:

• Over the June 2021 quarter, the company continued the resource drilling at the shallow high-grade copper-gold-silver discovery - the Cayley Lode at the Thursday’s Gossan prospect in the Stavely Project.
• The results received during the quarter have confirmed that the high-grade copper-gold-silver mineralisation extends to the north-west over a total strike length of 900m.
• With a cash balance of $13.82 million as at 30 June 2021, the company seems well funded to continue its exploration programs.

Revenue Trend (Source: Analysis by Kalkine Group)

Key Risks:

• Fluctuations in the Price of Copper: Since the company is mainly focused on the exploration copper, it is exposed to the risks related to the fluctuations in the price of copper.
• COVID-19 Uncertainties: The company is exposed to the risks related to the COVID-19 uncertainties, as it could cause delay or temporary suspension at the company’s operations.

Outlook: Looking ahead, the company is focused on making transformational mineral discoveries. The company has executed an Access Agreement for drill access to the paddock south of the railway line from 1 December 2021. This will allow the company to complete the Phase 1 Mineral Resource definition drilling.

Stock Recommendation: Over the last three months, the stock has been corrected by 16.66% and is currently trading lower than the average 52-week price level band of $0.37 and $0.96, offering a decent opportunity for accumulation. Considering the company’s decent progress in the ongoing exploration programs, recently received high-grade assay results at Cayley Lode, current trading level and associated key risks, we give a “Speculative Buy” rating on the stock at the current market price of $0.445, as on 3 September 2021, 12:10 PM (GMT+10), Sydney, Eastern Australia.

SVY Daily Technical Chart, Data Source: REFINITIV 

Note 1: The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decision should be made depending on the investors’ appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above. 

Technical Indicators Defined:  

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

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