24p Target11 Aug 2021 21:10
https://bluejaymining.com/wp-content/uploads/2021/05/Bluejay_Update_20210524.pdf
Valuation – target price increase to GBp24 with sensitivity to price upside
We upgrade our Dec’21 target to 24p/sh, implying 173% upside from the current price. We increase our long-term ilmenite to US$210/t (FOB) from US$200/t. This remains more conservative than the PFS input of US$232/t and current spot at ~US$330/t. We also update our tax rate to 25% (from 30%), with deductions in the calculation of royalties due. On this basis we reach an NPV8 of US$305m for Dundas, to which we apply a 0.8x multiple. We then add a further US$60m in value for JAY’s earlier-stage but equally attractive exploration assets. Adjusting for working capital and G&A, we derive a total Dec’21E risked SOTP of US$307m (24p/sh). Furthermore, we note for every US$10/t delta in ilmenite we would see a ~2.7p change in SOTP; marking-to-market for current spot prices of ~US$330/t, this would imply ~133% further upside to our PT to GBp56/sh.
Trading volume (m, rhs)
BlueJay Mining Ltd
AIM BASIC RES (rebased)
20 15
0
May-19 Sep-19 Jan-20
May-20 Sep-20 Jan-21
H&P Advisory Ltd is Corporate Broker to Bluejay Mining Plc. The cost of producing this material has been covered by Bluejay Mining Plc as part of a contractual engagement with H&P; this report should therefore be considered an “acceptable minor non- monetary benefit” under the MiFID II Directive.
Roger Bell
Director, Mining Research T +44-207-907-8534
E rb@hannam.partners
Jay Ashfield
Director, Mining Sales T +44-207-907-8500
E ja@hannam.partners
H&P Advisory Ltd
2 Park Street, Mayfair London W1K 2HX
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