Perseus Mining Limited

Section 1: Company Overview and Fundamentals

1.1 Company Overview:

Perseus Mining Limited (ASX: PRU) is engaged in the mining and exploration of gold. PRU operates three gold mines in West Africa, which are Edikan Gold Mine, Sissingué Gold Mine and Yaouré Gold Mine.

1.2 The Key Positives, Negatives, Investment Highlights and Risks

1.3 Top 10 Shareholders: The top 10 shareholders together form ~35.71% of the total shareholding. Van Eck Associates Corporation and T. Rowe Price Associates, Inc. hold a maximum stake in the company at ~10.99% and ~4.48%, respectively.

1.4 Key Metrics:

During 1HFY22, the company recorded an asset turnover ratio of 0.38x against 0.27x of the industry median. In addition, it recorded a debt-to-equity ratio of 0.07x as compared to 0.17x of the industry median. Below captured the trend of net margin and the current ratio. 

Section 2: Business Updates and Financial Highlights

2.1 Business Updates:

2.2 Insights of 4QFY22:

The company’s three operating gold mines, Yaouré and Sissingué and Edikan, have produced a total of 122,327 ounces of gold in 4QFY22. In addition, the AISC of USD 952 per ounce has placed the business near the middle of the global gold cost curve.

Section 3: Key Risks and Outlook:

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

4.2 Fundamental Valuation

Valuation Methodology: P/E Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is August 9, 2022. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

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