A Billion Dollar Market Cap on the cards for Chaarat Gold Holdings ?
“…At circa 22p, today’s share price is a good entry point for shareholders. We think the share price will double upon successful financing and development of the Tulkubash asset…”
At present the market cap of Chaarat Gold Holdings is £150 million and its strategy is to grow much, much bigger by having three operational projects by 2026.
That’s just four and a bit years away, and currently the company has its one producing asset – the Kapan gold mine in Armenia and two in development in the Kyrgyz Republic – the Kyzyltash sulphide deposit and Tulkubash oxide gold project.
Since management was refreshed in 2018, the company has become asset accretive, has become profitable and as the recently published H1 results reveal, Chaarat is beating its internal targets.
The chief financial officer Chris Eger is indefatigable. Concurrent to releasing the first half results, he’s working on the financing package for Tulkubash while working on the formalities involved in securing the new chief executive.
The company is fluid, like the metaphorical first gold pour it’s hoping to achieve at Tulkubash within two years. And to assist Chaarat’s transition from small cap to multi-billion dollar mid cap it started looking for a more operationally experienced CEO at the start of 2021. Eger says the announcement about who was the best candidate is imminent. “I have no doubt the marketplace will be very pleased with who we’ve been able to bring into the business to continue to drive growth for Chaarat.”
By the time the new boss is in place, Eger will have done the bulk of the work to craft a financing package for the estimated $100 million required for the construction of Tulkubash.
Kyzyltash though remains the biggest value driver.”It’s the crown jewel within the portfolio,” says Eger who describes the 5.4 million ounces potential as an enormous gold deposit. He uses the word ‘massive’ and says its will bring substantial value to the business.
At circa 22p, today’s share price he says is a good entry point for shareholders and he’s put his money where his mouth is and added to his own holding. “We think the share price will double upon successful financing and development of the Tulkubash asset.” The stock he says will move on the project financing which “provides that clear pathway to production of additional ounces into the business.”
Meanwhile Kapan continues to acts “as a cash cow backbone to the business.” Eger is eager to reinforce the achievements made at Kapan during Covid: “EBIDTA for the first half was $13.8 million which was a substantial increase compared to $4.1 million last year after driving down cash costs, we increased revenue substantially, we processed an enormous amount of third party ore on top of our existing ore.” And there’s more to come with the expansion of Kapan’s East Flank.
Listen to Chris talk to Sarah Lowther about his confidence in continued strong financial performance in the near term, medium and long term, and why the billions of dollars market cap comment wasn’t flippant, but the foreseeable.
Watch Chris and COO Darrin Cooper talk through the most recent results while putting the wider project potential into context.
Access the company’s latest corporate presentation here
Follow the company on Twitter – @ChaaratG
The author was remunerated but does not hold shares in the company