MDKA - Mining for Glory: A Golden and Nickel Odyssey

KBVS Update
Monday, 11 November 2024

MDKA - Mining for Glory: A Golden and Nickel Odyssey
(Reinitiate BUY - TP: IDR3,200)

3Q24 Gains Driven by Gold and Copper Performance MDKA posted a 3Q24 unaudited revenue of USD574 mn, with a 9M24 total of USD1.7 billion (+47% YoY), only slightly below expectations (74.1%). 3Q24 unaudited EBITDA reached USD44 mn (+10% QoQ), with a 9M24 total of USD185 min (+37% YoY). Gold, (79.3% of 3Q24 EBITDA), saw an ASP increase to USD2,566 /oz, while copper sales volumes rose to 4,970 tons (+145.2% QoQ). Lower AISC for gold aided results, though lower ore grades impacted volume.

Strategic Expansion Fuels Optimistic Growth Forecast We project continued growth for MDKA, with top-line growth expected at +23.3% YoY in 2025F, driven by increased nickel volumes from ZHN Smelter and SCM Mine, and surging gold prices. Anticipated contributions from Pani Gold will further boost revenue in 2025F, while improved nickel cash costs and stronger copper prices could enhance margins.

Reinitiate BUY with TP of IDR3,200, based on 13.6x ‘25F EV/EBITDA, 1.3x '25 P/BV

Regards,
Laurencia Hiemas - KBVS Research