Ann: Bankable Feasibility Study Update, page-11

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Grajem12

366 Posts.

25/05/18

11:01

Post #: 33305601

Originally posted by copperroad ↑

Update from Euroz - 45c target remains.
Lots of exploration upside etc. On these numbers, EAR looks like its on a forward PE x 3 times.
I would imagine that the stock valuation would be well north of 60c when its up and running this year..

Column 1 Column 2 Column 3 Column 4 Column 5

1

Column 1Echo Resources Ltd (EAR $0.24) Speculative Buy

Column 1Analyst

[/table]|
Date|
Price TargetAndrew Clayton|
24/05/18|
$0.45/sh[/table]
Bankable Feasibility Study Update
Key Points
The Yandal Gold Project Bankable Feasibility Study (BFS) is expected to be completed by end Jun’18:
· EAR are awaiting the receipt of tender submissions for the mining contract to finalise the BFS. This is expected during June.
· All major cost items have been advanced to formal tender or quote stage.
In anticipation of the BFS, EAR have appointed debt advisors and early discussions with potential financers are underway. Additionally, a Process Manager and Mining Manager have also been appointed.
Investment Case
We continue to like EAR as a low capex, emerging producer with excellent exploration upside. The DFS should demonstrate a robust development with reserve of ~ 850koz and annual production of >90koz ( Yrs 1-4 @ 105koz) at AISC of ~ $1,200/oz. We rate the exploration potential highly and expect further high margin ounces will be added over time. The recent Ramone discovery by NST just to the north of EAR’s tenement boundary has opened a new area of interest. Our valuation remains at $0.45/sh which is risk adj by 80%. Corporate action can’t be ruled out NST holding a 19.2% interest and its share price close to record highs.

[/table]

Column 1 Column 2 Column 3 Column 4 Column 5 Column 6 Column 7 Column 8 Column 9 Column 10 Column 11

1 Echo Resources Ltd (EAR)
Share Price

2 0.24

3
A$/sh

Price Target

4 0.45

5
A$/sh

Valuation

6 0.45

7
A$/sh

Shares on issue

8 488

9
m(dil)

Market Capitalisation

10 110

11
A$m

|

Column 1 Column 2 Column 3 Column 4 Column 5 Column 6 Column 7 Column 8 Column 9 Column 10 Column 11

1
Enterprise Value

2 98

3
A$/m

Debt

4 nil

5
A$/m

Cash

6 11.6

7
A$/m

Largest Shareholder

8 NST 19.2%

9
m(dil)

10

[/table]

Expand

Likewise I see value and opportunity with EAR going forward, no current debt, around $11M in cash and well funded for the next 12 months. Picked up a small parcel this morning and will top up as we go. DYOR

EAR Price at posting: 24.5¢ Sentiment: Buy Disclosure: Held

3 Upvote

0 Great analysis

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	Column 1	Column 2	Column 3	Column 4	Column 5	Column 6	Column 7	Column 8	Column 9	Column 10	Column 11
1	Echo Resources Ltd (EAR) Share Price
2	0.24
3	A$/sh Price Target
4	0.45
5	A$/sh Valuation
6	0.45
7	A$/sh Shares on issue
8	488
9	m(dil) Market Capitalisation
10	110
11	A$m

	Column 1	Column 2	Column 3	Column 4	Column 5	Column 6	Column 7	Column 8	Column 9	Column 10	Column 11
1	Enterprise Value
2	98
3	A$/m Debt
4	nil
5	A$/m Cash
6	11.6
7	A$/m Largest Shareholder
8	NST 19.2%
9	m(dil)
10

Ann: Bankable Feasibility Study Update, page-11

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