KZL 0.00% 12.0¢ kagara ltd

worth a little research

  1. 3,292 Posts.
    Stocks entering the index are always worth a bit of research. On the 4/12/2009 the ASX announcement referred to 6 stocks entering the ASX 200 from the end of trade on the 18/12/2009 (WHC, KZL, MRM, AAD, CRZ, BTA). Most of them come with some good recent prices gains & should be worth further research. Of the 6 stocks I have purchased KZL not because it will be the best of these 6 stocks over the short term, but because I liked its short term outlook on several fronts.
    Already IOOF Holdings Ltd (9/12/2009) has become a substantial shareholder with 5.13% of KZL & I would expect more institutional buying of KZL after today as it enters the ASX 200.
    Positives for KZL:
    1. Hold a number of world class projects (refer ASX AGM presentation 23/10/2009).
    2. Zero Corporate debt.
    3. Copper Production of 23,000 t & 46,000 t of zinc forecasted for FY ended 2010. Also remember, The Australian Bureau of Agricultural and Resource Economics (ABARE) has slashed its forecasts for copper production and exports for fiscal 2010, blaming disruptions at BHP Billiton's giant Olympic Dam mine for what would be the nation's lowest output in a decade.
    In its latest quarterly outlook, ABARE cut its forecast for refined copper exports by 15.8 per cent for the year to June 30, 2010, and its estimate for refined copper output by 13 per cent.
    "If realised, this will be the lowest refined copper production recorded in Australia since 1998-99," it said (refer Reuters report)
    4. Mungana Goldmine Ltd IPO (2.6m oz gold , 180,000 t copper plus 26 m oz silver) very close to happening & existing KZL should receive some entitlements or priorities to this issue.
    5. Lounge Lizard Nickel agreement with Western Areas to sell 2,000 tonnes p.a. of nickel concentrate from ore blended with Kagaras Lounge Lizard. (refer ASX Announcement 8/12/2009)
    6. Admiral Bay Zinc Project - Pre Feasibility Study underway
    7. Several very smart existing shareholders already on the Share Registry in Matthews Capital Partners (2.7%) & Paradice Investment Management 1.8% (refer ASX announcement 23/10/2009)
    8. Experienced management team.
    9. Chart wise KZL have been in a channel since September, but any break above say $1.14 could see them go for a run.
    On the basis of these positive facts I have increased my holdings in KGL as I expect outperformance over the short term.
    Please not no investment advice is given please do your own research on KZL.
    Regards
    Buffett

 
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