Align Research - Initiation of Coverage - Shefa Yamim
Shefa Yamim (A.T.M.) Limited listed on the LSE in December 2017. After 19 years of exploration in greenfield terrain in Israel, the company has found commercial quantities of some exquisite and rare coloured gemstones which are destined to fetch fancy prices.
- Early cash flow expected with the start of commercial mining in 2020
Trial mining is scheduled to begin later on this year, with commercial mining of the Kishon Mid-Ranch Zone 1 in 2020. The granting of a mining licence will allow the company to sell the gemstones found in bulk sampling and other exploration work, which provides the prospect of early cash flow.
- Capturing high margins with a Gemfields-style
Mine to Market strategy World renowned jeweller Yossi Harari is creating an exclusive collection using these gems. Shefa Yamim is pursuing a similar strategy to that successfully pursued by Gemfields, which was acquired for £200m+ in 2016.
- Gemstone market growing fast with prices outperforming diamonds
Over the last five years, the coloured gemstone market has grown by 145% to US$6 billion and outperformed the price of diamonds by 37% since 2005.
- Risked conservative NPV suggests upside of more than 600%
Our conservative valuation shows the potential. We initiate coverage of Shefa Yamim with a target price of 376p and Conviction Buy stance.
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| IMPORTANT: SEFA is a research client of Align Research. Research owns shares in SEFA. For full disclaimer information please refer to the last page of the full document. | ||||||||||||||||
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