Syrah Resources Ltd

SYR Details
· Evaluating every target opportunity:Syrah Resources Ltd (ASX: SYR) stock fell over 4.2% (on December 07, 2016) owing to market sentiments and short interests. The EV production is expected to drive significant near-term demand for graphite anode material. More than 100,000 tonnes per annum of incremental natural graphite BAM (>200,000 tonnes of flake graphite feed material) is expected to be required by 2019. There is an opportunity for SYR to participate in the entire supply chain, from mine to anode material and improving the product consistency for end customers. Moreover, SYR has the potential to capture additional margins through downstream processing.  The downstream strategy encompasses understanding the customer and to deliver qualified battery anode material during Q4 2018. Balama is scheduled for commissioning in Q2 2017 and the production ramp up in Q3 2017. SYR will develop a commercial plant to supply the battery anode market. In addition, SYR is having commercial discussions with the customers regarding sales into the spherical graphite and by-product markets for Balama. SYR has medium term outlook to establish the additional commercial plant in Asia to meet the demand requirements and optimize the profitability. The strategy is expected to accelerate the cash flows and profitability from downstream processing while minimizing the risk.

· Recommendation: SYR stock has fallen over 52.5% in the last six months (as of December 06, 2016) offering an investment opportunity. We give a “Buy” recommendation at the current price of – $ 2.73
 

BAM Sales Pipeline Status (Source: Company Reports) 

Regis Healthcare Ltd

REG Details
· Net RAD receipt fall in FY 16: Regis Healthcare Ltd (ASX: REG) stock lost over 3.95% on December 07, 2016, post a 14% rally in last five days. This may be owing to volatile market sentiments on aged-care sector and concerns on the Refundable Accommodation Deposit (RAD). REG in FY 16 has reported net profit after tax of $46.1m and EPS of 15.34 cents, which has been in line with the expectations. The normalized EBITDA and normalized NPAT for FY16 has exceeded the prior corresponding period by 20% and 24%, respectively, due to the growth in the revenue that includes the increased contribution from the Significant Refurbishment program. However, REG in FY 16 has the net RAD receipt of $44.9 million, which is lower than in the prior period, on the back of grandfathering of RAD and DAP paying residents. Additionally, REG is positioning itself for substantial growth from greenfield developments and at the end of September 2016, while the company has 1,404 new places in the expansion pipeline.

· Recommendation: REG stock rose over 19.06% (as of December 06, 2016) in the last three months, placing the stock at higher P/E. Hence, we give an “Expensive” recommendation at the current price of – $ 4.38 

FY 16 Financial Performance (Source: Company Reports)

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