In today’s briefing:
- Lundin Mining (LUN CN): Cheap Play on Copper
- Matt Warder & Koala Unpack Peabody’s $3B+ Coal Deal
- Satvik Green Energy Ltd Pre-IPO Tearsheet
- [Earnings Review] Saudi Aramco Maintains Dividend Despite Decline in Net Profit in Q3
- Southern Energy Corp. (SOUC LN/SOU CN): Better Balance Sheet than Expected.
- Toyobo (3101) – Signs of Recovery in Profitability on the Back of Improving Operating Environment
- Helixtap China Report: Declining Inventory Could Help Revive Demand
- New Fortress Energy: Expansion in Puerto Rico Energy Sector As A Vital Factor Driving Growth! – Major Drivers
- Criterium Energy Ltd (TSX-V: CEQ): Work-Overs Outperform. Still Waiting on Well Results.
Lundin Mining (LUN CN): Cheap Play on Copper
- As part of our series of initiations on copper stocks, Lundin Mining (LUN CN) is another play with a cheaper multiple than Southern Copper (SCCO US) but an inferior ROCE.
- With its most recent acquisition of the Jose Maria copper project in a 50:50 JV with BHP, the mid-size copper-producing company is on its way to growth after 2027.
- Trading at 17x FY25e and 5.0x EV-EBITDA, this is another company in our stable worth exploring.
Matt Warder & Koala Unpack Peabody’s $3B+ Coal Deal
- WA government announces $150 million package for lithium miners, including waiving government fees for two years
- Package also includes a $50 million loan facility for interest-free loans to sustain operations
- While the news did not significantly impact stock prices, it provides some relief and support for struggling lithium companies
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Satvik Green Energy Ltd Pre-IPO Tearsheet
- Saatvik Energy Green Ltd (1637892D IN) is planning to raise about US$136m through its upcoming IPO in India. The lead bookrunners for the deal are Dam Capital, Ambit, Motilal Oswal.
- Saatvik Green Energy Ltd (SEG) specializes in the manufacturing of solar photovoltaic (PV) modules and provides comprehensive engineering, procurement, and construction (EPC) services.
- As per Crisil report, since its inception, the company has supplied over 1.5 GW of high-efficiency solar PV modules to both domestic and international markets.
[Earnings Review] Saudi Aramco Maintains Dividend Despite Decline in Net Profit in Q3
- Aramco’s Q3 operating revenue fell 1.8% YoY and missed estimates by 0.5%. Similarly, its net profit fell by 15.4% YoY and its EPS missed expectations by 1%.
- Aramco’s total hydrocarbon production fell 0.8% YoY but rose 3.3% QoQ in Q3. Its average crude oil price realisation dropped 11.2% YoY and 7.5% QoQ.
- Despite a decline in net profit, Aramco maintained its dividend, which led to a shift from net cash to a net debt position as dividend payouts exceeded free cash flow.
Southern Energy Corp. (SOUC LN/SOU CN): Better Balance Sheet than Expected.
- 3Q24 production of 2,336 boe/d was in line with our expectations.
- Southern has monetized excess inventory for US$2 mm during 3Q24, resulting in net debt being reduced by US$1.4 mm.
- Southern estimates that further excess inventory could be sold for US$1-1.5 mm.
Toyobo (3101) – Signs of Recovery in Profitability on the Back of Improving Operating Environment
- Positive trajectory – Q2FY3/25 results continued to show signs of recovery in margins (2.4% Q2 FY3/24, 3.7% Q2 FY3/25), reflecting price hikes, volume expansion, and cost reduction.
- By segment, Films was the largest contributor to OP growth (+686.5% YoY), followed by Environmental and Functional Materials (+102.1%).
- Strong OP growth attributed to moderating cost pressures, and improving demand, which has led to unit price hikes without sacrificing volume.
Helixtap China Report: Declining Inventory Could Help Revive Demand
- Inventory lowest in 13th months
- Arbitrage widens for African and Indonesian rubber
- Frontloading resulted in spike in exports
New Fortress Energy: Expansion in Puerto Rico Energy Sector As A Vital Factor Driving Growth! – Major Drivers
- New Fortress Energy, a company involved in the development and operationalization of liquefied natural gas (LNG) projects, reported its third-quarter 2024 earnings.
- Overall, New Fortress Energy achieved an adjusted EBITDA of $176 million, aligning with prior forecasts.
- Operational highlights include the progress of the Fast LNG (FLNG) unit, which met and exceeded nameplate capacity in trials.
Criterium Energy Ltd (TSX-V: CEQ): Work-Overs Outperform. Still Waiting on Well Results.
- 3Q24 production of 879 bbl/d was in line with expectations.
- The company’s cash position of C$6.1 mm at the end of September is high but reflects greater current payables.
- We note a further opex reduction from C$3.4 mm in 2Q24 to C$2.6 mm with flat production.