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KZL - Kagara Limited

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Re: KZL - Kagara Zinc

Zinifex is a slightly different kettle of fish as they have the Hobart and Port Pirie smelters to value add by making the actual zinc and lead ingots to sell into the world market.
 
Re: KZL - Kagara Zinc

Realist said:
As good as MRE?

I've basically doubled my money on MRE including dividends? When are you thinking of selling MRE if at all?
Click to expand...
MRE is the "Bradbury" of the stock market!
Zinc is not skating on thin ice.


btw - "sell" and "MRE" must only be conjoined with "don't"
 
Re: KZL - Kagara Zinc

rederob said:
MRE is the "Bradbury" of the stock market!
Zinc is not skating on thin ice.


btw - "sell" and "MRE" must only be conjoined with "don't"
Click to expand...


Haha, I agree.

With stocks and selling : 9 times out of 10 I wont sell them, the 10th time I think about it then don't sell them.

I'll hold MRE at least till I've held it a year to reduce tax and get the next dividends.
 
Re: KZL - Kagara Zinc

rederob said:
Don't be silly!
These are the best equities on the market - buy both and have many more happy returns.
Click to expand...

I second that.

Realist - ZFX's income is very much dependant on Century, not necessarily a bad thing as its the worlds 2nd biggest zinc mine in production. Its current mine life is until 2013. They are currently working to try and extend that to 2020.

KZL on the other hand, like ZFX, their profit was achieved with prices of us$2.07/lb copper and us$1.00/lb zinc, so even if prices dont move from here, their profits will be >50% more anyway (but im fairly confident zinc will spike - it has to - soon the LME inventories will be depleted and smelters will need their zinc, at whatever price to keep their consumers happy).

KZL has a very strong production growth profile, with Zn production to increase from 35ktonnes to 50ktonnes in FY07 and Cu production to increase about 4-fold from 6.5ktonnes to 25ktonnes in FY07. There are further increases until 2009 from their CURRENT RESOURCE.

Now they have King Vol which will add to that production and add an extra 10 years. The resource there just doubled. And then next year 1Q they are drilling Admiral Bay which looks very promising.

And above all that they hold 17% stake in MLM for exposure to nickel.

Have a look at their latest presentation - its all spelt out there,

But Rederob nailed it - ZFX + KZL a deadly deadly combination and i feel when we look back at the performance of these two in 3-6months time, even we will be suprised at how much money we have made...

The above does not constitute financial advice. Please consult a professional investment advisor and/or do your own research before investing.
 
Re: KZL - Kagara Zinc

About time it broke $6 resistance....and did it in style too, been waiting 5 trading days for this.
May buy some more today.......go baby go!
 
Re: KZL - Kagara Zinc

KZL is the best value Zinc and (bonus) copper play on the market.
If Zinc prices hold up, it should conservatively have an SP of $8.00 by the end of the financial year IMHO.
I'm holding Long and hopefully some pullbacks, enable some trading opportunities as well.
 
Re: KZL - Kagara Zinc


your very conservative
calendar year EASY
u must consider MOMENTUM

towards the end of the year when analysts realise zinc is stronger for longer and upgrade earnings forecasts thats what will provide the push into double digits into 2007.

All in my opinion only. \
I hold this one.
 
Re: KZL - Kagara Zinc

Someone on another board asked me why i prefer KZL over ZFX. Here was my response -

KZL or ZFX - i thought about it for a long long time. It was a tough choice. Ultimately whichever one you choose in my opinion ull do well.

(obviously its better to hold both)

ZFX have minelife problems. It has a low pe for a good reason. The market was paying 6x earnings for it last year and will probably pay only 6x for it this year and same next year. Nobody wants to top dollar at a (perceived?) top of a mining boom for a company that will have nothing to mine in a few years. BUT i reckon this stock is still a winner as its leveraged best to zinc due to sheer economies of scale. Its NPAT of $1billion was based on 97c/lb. If zinc stays where it is now, which i think is highly unlikely, their profit will be about $2billion which is almost $5/share, making a $2/share dividend ever more likely. So double the earnings, double the share price, and its all good. But they will not be increasing production to any significant extent.

For KZL, their increase in production is so great, damn its not even funny. Zinc production will increase from 35ktonnes to 52ktonnes a 48% increase, lead will increase from 10ktonnes to 15ktonnes (50%) but copper will increase from 6.5ktonnes to 25ktonnes which is a 284% increase. Now on Kagara's managements figures, their EBIDTA will be $200million next year based on us$3.18 copper and $1.54 zinc. Based on my own figures personally i think higher due to the spike in zinc price so NPAT upwards of $200million. Thats not a doubling, like ZFX, but rather almost a SIX-FOLD increase from its FY2006 NPAT of $35million.

People are willing to pay a higher earnings multiple for KZL because they are will see massive earnings growth in the next few years due to increases in production. The increase in FY2007 is due to Thalanga, the copper production hub that just opened this month. But in April 2008 Mungana will open and that will further increase total production of Zn to 70ktonnes from 50ktonnes and Cu from 25ktonnes to 40ktonnes.

AND THEN!!!! King Vol which was just drilled excellent results there and that could add another 10 years to the mine life of KZL's projects. And then, yes theres more, Admiral Bay, in WA, which looks very promising will be drilled in the first quarter of next year.

KZL also have a 17% stake in MLM, nickel explorer, which resources is very close to Mt Garnet in QLD, which is KZL's major operations.

KZL will be increasing production at a rate that will grow earnings and more than offset any decreases in zinc and copper spot prices down the track. Thats why the market is willing to pay more for it. Its share price appreciation speaks for itself.

Remember KZL is unhedged. With zinc spot price the spike has yet to be seen.

They also have the some of the best management in the industry. Resources are increasing all the time.

Takeover target? Perhaps, why not, the rate they will grow production in the next few years make it very appealing, especially as they will have no substantial capex to deal with. I'll be very suprised if other companies havent at least looked at this.

Please note the above is my opinion only and does not constitute financial advice. Seek a professinal financial advisor or do your own research before investing.
 
Re: KZL - Kagara Zinc

Nizar,

Im impressed with your views.I hold both so looks like ill do ok.well im expecting better than just ok.

You really do your research well done.


You look to have a great future in the stockmarket.

Best of luck with it.
 
Re: KZL - Kagara Zinc

Ok - so here's a Q? from left field... maybe...

Considering ZFX's mine life problem (though there's alot of metal to be got by 2013?!!- sounds OK to me!!) - Are they, or will they be in a position to swallow KZL ?? If so - when would be a logical time to do it??

After all - ZFX's mine lies between KZL's Mt Garnet and Thalanga operations (i think). Why not??
 
Re: KZL - Kagara Zinc


well Korea Zinc Co Ltd has a 14% stake in KZL (15-06-06) which makes any takeover difficult for ZFX as they have to deal with Korea Zinc
 
Re: KZL - Kagara Zinc

After an absence from KZL for short period I went long on KZL using CFDs late yesterday, up this morning. porkpie
 
Re: KZL - Kagara Zinc

sleeper88 said:
well Korea Zinc Co Ltd has a 14% stake in KZL (15-06-06) which makes any takeover difficult for ZFX as they have to deal with Korea Zinc
Click to expand...

Yeh true and CBH have Toho zinc with about 24%, making both KZL and CBH hard to buy. But i think btw ZFX, KZL, and CBH there will be some sort of corporate play before the end of the year.

I have a good mate of mine works for KPMG Accounting, they handle all the accounts for ZFX, and him and his mates reckon ZFX, with all the cash they have, and their EXEMPLARY debt levels, are on the look out and have done the figures on a number of prospects. They've have brought their tax losses forward which may indicate they are gonna buy another business. CBH is the first company that came to mind. ZFX want Endeavour back! as it used to belong to Pasminco before it went bust, its one the few assets that ZFX didnt pick up.

CBH is trading at cheap earnings multiples (5x) especially if u consider its pipeline of growth. Earnings per share may (naturally) be downgraded slightly due to the extra 100million shares but possibly left the same due to zinc price strength.

Anyway, Im sure those Koreans and Japs will sell out for the right price, which will probably be a massive premium to the current market price. Either way it looks good for the shareholders.

tasmanian - thanks for the kind words, hopefully we both do well.

KZL is up again to $6.42 - sometimes i underestimate this company. It really is a winner
 
Re: KZL - Kagara Zinc

It's climbing the mountain again today, holding KZL&ZFX, let's see what the rest of the week holds for them.
 
Re: KZL - Kagara Zinc

pacer said:
It's climbing the mountain again today, holding KZL&ZFX, let's see what the rest of the week holds for them.
Click to expand...


This company is a winner, wenever i check it, its running. Im looking 4ward to a good quarterly.
 
Re: KZL - Kagara Zinc

It's still running.....and I am too....when will it peak?
 
Re: KZL - Kagara Zinc

I'm not sure on KZL at the mo either, still a good prospect though, but at the mo only day trading KZL with CFDs, had some good gains too. porkpie
 
Re: KZL - Kagara Zinc

pacer said:
It's still running.....and I am too....when will it peak?
Click to expand...

probably about 12 months from now.

obviously it will be affected by any general market correction. metals havent run far enough to correct just yet.

MS when do u estimate that will happen?
 
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