Given a ten-day shutdown at Allkem’s Olaroz project during the March quarter, production came in softer than Citi had estimated at 2,972 tonnes compared to an expected 3,500 tonnes, but the broker highlighted costs were lower than expected.
Revenue was up US$128m quarter-on-quarter, with realised pricing of US$27,236 per tonne. Looking ahead, the broker expects realised pricing to reach US$35,000 per tonne in the June quarter, while Naraha first production is expected.
The Buy rating and target price of $16.00 are retained.
Sector: 0.
Target price is $16.00.Current Price is $13.52. Difference: $2.48 – (brackets indicate current price is over target). If AKE meets the Citi target it will return approximately 16% (excluding dividends, fees and charges – negative figures indicate an expected loss).
