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Canary Capital Finds Auric Mining a ‘Compelling Investments Case’

Auric Mining (ASX: AWJ) is a “compelling investment case” poised for significant growth driven by the potential of its two flagship projects, Jeffreys Find and Munda Gold, Sydney, Australia-based investment management and corporate advisory firm Canary Capital wrote in a new equity research report.

“AWJ is our preferred ASX-listed company to participate in the current favourable macro environment for gold,” said the report prepared by Paul Hart and Arun Sengupta, both directors at Canary Capital.

The report noted the remarkable progress made by AWJ - transitioning from tenement acquisition and ASX listing to mining and cash flow generation in just under three years - earning $4.77 million in cash from Stage One of the Jeffreys Find gold mining project. More than 9,741 ounces of gold have been mined and sold from Jeffreys Find to date.

A picture of the Jeffreys Find ore body showing gold mineralisation location evidenced by darker zones

AWJ has also completed a scoping study for the Munda gold project, showing exceptional economics and a path to cash flow generation of approximately $77 million.

“Despite the significant cash flow potential of the company’s projects, the current market capitalisation is just $20.3m. We view this as presenting investors with an opportunity to invest in AWJ at a fraction of the real intrinsic value of the company,” the report said.

Highlights of the report:

  • AWJ has made remarkable progress in a span of just under three years since its ASX listing and the acquisitions of assets.
  • Cash generated from Stage One production at Jeffreys Find, which totals $4.8 million, will fully fund AWJ in 2024 as it develops Stage Two production, which is expected to generate between $6 million and $8 million for the company.
  • Munda’s exceptional economics, with a projected positive cash flow of $76.9 million over a 13-quarter mine life based on a conservative gold price assumption of A$2,600/ounce.
  • Munda will commence operations with a three-month starter pit and a low capital investment of $1.3 million and a working capital investment of approximately $6.0 million.
  • Munda is projected to generate around $8.7 million in surplus cash for AWJ, depending on the results from the current drill program.

Read the full analyst report here.

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