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|rambutan2: hated in canada, not traded on aim, 12% purchased by bhp at way above current share price, and with 2 world class sets of assets - congo land and angolan project - as well as other promising stuff in canada and africa. balance sheet not the best, but not the worst. production potential within 12-18mths perhaps. sounds like a good time to buy some. imho a better bet than petra!|
|energyi: CROWN was a helluva acquisition, if the brokers can say this...
Given the early stage nature of most of the Mano and Kalahari assets, the deals have little immediate impact upon our target price, indeed with the additional dilution, our target price has dropped slightly for the short-term. However, we anticipate that development and exploration success on both Petra¡¦s new and existing projects will lead to a significant rise in our target price.
With the new acquisitions, Petra has an ideal balance of exploration, development and production assets. This, combined with the geographical spread of the Company¡¦s projects, provides an excellent diversification of risk without compromising reward. Ultimately, Petra has assembled a highly experienced management team and a portfolio of assets that has exceptional potential to create value for shareholders.
Petra¡¦s aggressive growth programme is creating a unique mid-tier diamond producer that could see the company producing between 500,000 and 750,000 cts p.a. by 2009/10 (and this does not take into account any production from Alto Cuilo). It is also important to note that the Company as a whole is currently trading on P/E multiples of 15.5x and 10.8x for 2006/7 and 2007/8 respectively. In other words, just the production assets and cash within the company support the current share price ¡V Alto Cuilo and the exploration assets are essentially in for free!
We look forward to the company bringing its projects, both new and existing, to account over the next 12 months and unlocking the inherent value.
We therefore maintain our BUY recommendation on Petra Diamonds. Due to the dilution from the recent transactions, our current target price has marginally fallen to £1.40/sh.|
Diamond Cap share price data is direct from the London Stock Exchange