CNMC Goldmine

CNMC Goldmine: Following announcements of record gold dore production of 1,360oz in Jul and 3,420oz in Sep 2013. In contrast, 1H 2013 gold production was only 2,073oz. CNMC’s share price of $0.235 as at 28 Oct 2013 suggests that the market may yet to have fully priced in the growth in CNMC’s production. In addition, there could be some upside risk in the estimation of 3Q net profit as unit costs have most likely been driven lower by economies of scale. CNMC further reported recently that it produced 1,526oz of gold dore in a single gold pour in Oct 2013, suggesting that the strong performance in 3Q is being carried forward into 4Q. House notes that CNMC need only produce another 3,350oz of gold in 4Q to meet its full year forecast of 12,000oz - an achievable target given recent output levels, but subject to weather considerations. Voyage has an Increase Exposure rating, with TP $0.80. This implies a whopping 240% upside on its last closing price of $0.235.