Tectonic Gold – Initiation of Coverage
Considerable value being created by generating a series of 3Moz+ IRGS gold projects to be joint ventured or sold to majors
Tectonic Gold Plc is the old StratMin which traded on AIM from 2004 to 2017 and became a cash shell following the divestment of its mining assets. It has since been engaged in the reverse takeover (RTO) of Australian based gold explorer, Signature Gold. With the RTO complete, the company is being admitted to the NEX Exchange. Tectonic Gold is focused on the huge global opportunity in large-scale high-grade Intrusive Related Gold Systems (IRGS), which investors are just waking up to.
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IRGS represents a new source of major gold projects for the future
Tectonic Gold is a highly-leveraged play on the gold price. IRGS is the new frontier for discoveries of significant large gold deposits that occur in certain tectonic belts worldwide. The company is an IRGS pioneer, developing bespoke R&D and definitive systems based exploration methods after many years of painstaking work. Tectonic is now set to benefit from its obvious first mover advantage.
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Drilling 10,000m shortly to ascertain grade and define a JORC resource
All 10 projects in Tectonic’s pipeline have an extensive audited database of past drilling/mining. This, combined with state-of-the-art technology, means that IRGS have been identified at low cost. With discoveries made and gold known present, Tectonic is set to drill the first play, Specimen Hill.
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Cornerstone investor is a savvy drilling company
A strong endorsement comes from international operator. Titeline Drilling’s substantial investment at the IPO. This is a strong endorsement from an industry partner which speaks volumes for the company’s potential.
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Peer comparisons suggests an upside of 280%
Our conservative valuation illustrates succinctly the clear opportunity for investors. We initiate coverage of Tectonic Gold with a target price of 7.60p and Conviction Buy stance.
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RISK WARNING & DISCLAIMER
Tectonic Gold (TTAU) is a research client of Align Research. Align Research & a director of Align Research hold interests in the shares of TTAU. For full disclaimer information please refer to the last page of the full document. This investment may not be suitable for your personal circumstances. If you are in any doubt as to its suitability you should seek professional advice. This note does not constitute advice and your capital is at risk. This is a marketing communication and cannot be considered independent research.
Year to Dec | 2015A | 2016A | 2017E | 2019E* |
---|---|---|---|---|
Revenue (£'000) | - | - | - | 200 |
Pre-tax (£'000) | (23,205) | (7,405) | (700) | (3,400) |
EPS (p) | (16.6) | (4.50) | (0.39) | (0.50) |