Since the beginning of the year, Solidcore Resources shares have grown by 60% due to rising gold prices and a positive reassessment of the company by the market after the elimination of most of the sanctions risks associated with Russia. 2/3 of the stock's growth occurred in September in the absence of significant news and high trading volumes (it is worth noting that it began before the publication of the September 11 financial statements, which theoretically could have affected the quotes, but did not).
We continue to look positively at Solidcore shares, as we see further potential for investors to reassess the company after the company leaves for Kazakhstan. In the long term, the main growth drivers will remain plans to double gold production (to 1,000 thousand ounces) and the commissioning of the EGMK ore processing complex in 2028, which will eliminate the company's dependence on third-party processing (its negative impact could be assessed, among other things, by the latest 1H25 financial statements, in which the company halved its gold production due to processing delays). A pleasant bonus may be to receive a listing on an international stock exchange, which the company announced earlier, and an earlier return to dividends due to significantly increased gold prices (the company previously announced that it does not plan to pay dividends until the launch of the EGMC in 2H28) and, as a result, the improvement of the economy of the EGMC project.
We have increased the target price of Solidcore Resources shares from 6 to 9 due to the increase in gold prices relative to the level of February 2025 (30%), when the previous recommendation was made. Otherwise, the assessment approach and expectations from the company have not changed. Solidcore's 2025 EV/EBITDA is 2.8x with a median of 6.5x for international gold mining companies, which also speaks in favor of the cheapness of its shares.
