Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Commodities

<ul>
<li>Iron ore found no support at the 95-100 USD/ton range for the first time in a while and broke through it, gapping down 8.8% WoW to 92 USD/ton.</li>
<li>This break is a major short-term bearish signal for iron ore prices, as market participants would lose confidence in the theory of cost support at 95-100 USD/ton. </li>
<li>TSF data and mill margins ( -575 RMB/ton) from China also do not inspire much confidence in the near-term outlook for iron ore. </li>
</ul>


Iron ore found no support at the 95-100 USD/ton range for the first time in a while and broke through it, gapping down 8.8% WoW to 92 USD/ton.
This break is a major short-term bearish signal for iron ore prices, as market participants would lose confidence in the theory of cost support at 95-100 USD/ton. 
TSF data and mill margins ( -575 RMB/ton) from China also do not inspire much confidence in the near-term outlook for iron ore. 


Iron Ore Tracker (19-Aug-2024): Major Testing Point of 95 USD/Ton, Broken For Iron Ore

Energy Transition | AI | Shifting World Order, Mint Finance

Pranay Yadav

Energy Transition | AI | Shifting World Order

Deep Fundamental Analysis

Mint Finance

Mint Finance's investment research blends deep fundamental analysis with technical & quant insights. Investment strategies straddle across multiple asset classes with risk management embedded into every trade to deliver an outsized reward-to-risk ratio.

Mint Finance's research is centered around three key themes. First, energy transition and climate change. Second, artificial intelligence. Third, shifting world order with its impact across politics and monetary economics.

<ul>
<li>Iron Ore Price Decline: Iron ore prices dropped 1.7% in Week 32, driven by reduced steel output and fading demand. Stimulus-driven rally failed to sustain.</li>
<li>Options Market Trends: Weekly options volume surged, with put volume increasing 106%, pushing the put/call ratio to 1.33, indicating bearish sentiment.</li>
<li>Implied Volatility Shifts: Implied volatility (IV) surged midweek, particularly for September contracts, reflecting increased market uncertainty; options skew narrowed to just 0.3% suggesting more expensive calls.</li>
</ul>


Iron Ore Price Decline: Iron ore prices dropped 1.7% in Week 32, driven by reduced steel output and fading demand. Stimulus-driven rally failed to sustain.
Options Market Trends: Weekly options volume surged, with put volume increasing 106%, pushing the put/call ratio to 1.33, indicating bearish sentiment.
Implied Volatility Shifts: Implied volatility (IV) surged midweek, particularly for September contracts, reflecting increased market uncertainty; options skew narrowed to just 0.3% suggesting more expensive calls.


[IO Weekly 2024/32] Chinese Economic Sentiment Sours, Driving Iron Ore Lower; Option Activity Surges

<ul>
<li>
<a href="https://www.smartkarma.com/entities/champion-iron-ltd" target="_blank" data-smartkarma-citation="entities:19734:1" rel="noopener">Champion Iron (CIA AU)</a> reported an inline Q1 FY25, with revenue/earnings up 57%/308% YoY owing to a 34% YoY volume increase and better pricing. </li>
<li>The company reiterated its guidance for 15 million tons of production and equivalent sales. It is working on improving logistics after forest fires and other port/rail issues. </li>
<li>The stock trades at 8.5x PE and a 6% dividend yield for FY25e ( assuming iron ore prices of USD 108/ton with a 15 USD/ton premium on 65% Fe). </li>
</ul>



Champion Iron (CIA AU) reported an inline Q1 FY25, with revenue/earnings up 57%/308% YoY owing to a 34% YoY volume increase and better pricing. 
The company reiterated its guidance for 15 million tons of production and equivalent sales. It is working on improving logistics after forest fires and other port/rail issues. 
The stock trades at 8.5x PE and a 6% dividend yield for FY25e ( assuming iron ore prices of USD 108/ton with a 15 USD/ton premium on 65% Fe). 


Champion Iron Q1 2025: Inline, High-Grade Iron Ore on Critical Minerals List in Canada

<ul>
<li>Iron ore bounced from the 100 USD/ton level and has maintained a rangebound level between 95 and 130 USD/ton for the last three years.</li>
<li>Inventories at the ports continued to increase, surpassing 150 million tons, representing about 38 days of inventory (normalized levels around 35 days). </li>
<li>After Capital Group's recent selldown<a href="https://www.mining.com/web/fortescue-investor-seeks-to-sell-1-3-billion-worth-of-shares/" target="_blank" rel="noopener">, </a><a href="https://www.smartkarma.com/entities/fortescue-metals-group-ltd" target="_blank" rel="noopener">Fortescue Metals (FMG AU)</a> looks attractive (with a trailing dividend yield of 11% and 6.5x PE) and could be worth exploring. </li>
</ul>


Iron ore bounced from the 100 USD/ton level and has maintained a rangebound level between 95 and 130 USD/ton for the last three years.
Inventories at the ports continued to increase, surpassing 150 million tons, representing about 38 days of inventory (normalized levels around 35 days). 
After Capital Group's recent selldown, Fortescue Metals (FMG AU) looks attractive (with a trailing dividend yield of 11% and 6.5x PE) and could be worth exploring. 


Iron Ore Tracker (07-Aug-2024): Port Arrivals High, Inventory Piles up at 35 Ports

<ul>
<li>Iron ore prices rose 1.8% last week, maintaining levels above $100/MT due to positive sentiment from potential Chinese stimulus measures.</li>
<li>The volume put/call ratio for FEF options last week increased to 1.23, reflecting renewed put activity despite positive price action.</li>
<li>Implied volatility (IV) remained largely flat last week. Despite continued interest in put options, IV skew declined suggesting puts became relatively cheaper.</li>
</ul>


Iron ore prices rose 1.8% last week, maintaining levels above $100/MT due to positive sentiment from potential Chinese stimulus measures.
The volume put/call ratio for FEF options last week increased to 1.23, reflecting renewed put activity despite positive price action.
Implied volatility (IV) remained largely flat last week. Despite continued interest in put options, IV skew declined suggesting puts became relatively cheaper.


[Iron Options Weekly 2024/31] Small Price Recovery in Iron Ore Following China Stimulus Measures

Australia

Iron ores are rocks and minerals from which metallic iron can be economically extracted. The ores are usually rich in iron oxides and vary in color from dark grey, bright yellow, deep purple, to rusty red. The iron itself is usually found in the form of magnetite (Fe3O4, 72.4% Fe), hematite (Fe2O3, 69.9% Fe), goethite (FeO(OH), 62.9% Fe), limonite (FeO(OH).n(H2O)) or siderite (FeCO3, 48.2% Fe).

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Iron Ore (IRON ORE COMDTY)

Iron Ore Tracker (19-Aug-2024): Major Testing Point of 95 USD/Ton, Broken For Iron Ore

Iron ore broke out of its 95-130 USD/ton level and is now 92 USD/ton. The short-term outlook looks bad as at this level confidence is broken in the...

Sameer Taneja

[IO Weekly 2024/32] Chinese Economic Sentiment Sours, Driving Iron Ore Lower; Option Activity Surges

Week 32 saw iron ore prices drop amid weakening Chinese steel demand, while options market activity surged, particularly in puts, signaling bearish...

Mint Finance

Champion Iron Q1 2025: Inline, High-Grade Iron Ore on Critical Minerals List in Canada

We summarize the Q1 FY25 results for Champion Iron (CIA AU). Trading at 8.5x FY25e PE with a 6% yield, and high-grade ore placed on Canadas...

Sameer Taneja

Iron Ore Tracker (07-Aug-2024): Port Arrivals High, Inventory Piles up at 35 Ports

With iron ore continuing to remain rangebound between 95-130 USD/ton for the last 3 years (with minor overshoots), we summarize actionable ideas in...

Sameer Taneja

[Iron Options Weekly 2024/31] Small Price Recovery in Iron Ore Following China Stimulus Measures

Iron ore prices experienced a modest recovery, buoyed by anticipated Chinese stimulus. However, options markets suggest put activity remains...

Mint Finance

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