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Kazera Global Investments - Initiation of Coverage

Kazera is an Africa focused mining investor which, in 2014, took a 75% stake in Aftan, owner of a high-grade tantalum project in Namibia & following the 26 June 2020 RNS, now has 100% control. Commercial mine production has yet to be achieved due to a lack of water but has qualified several shipments to run directly into End User production. A 17km pipeline from the Orange River would solve this problem, coupled with some plant upgrades, and cost @ US$11 million. A recent transformative deal takes Kazera into diamonds and heavy mineral sands (HMS) but, critically, with the anticipated cash flows intended to provide the funding runway to fully develop this large-scale world class tantalum opportunity.

• Early cash flow at the diamond operation before the year-end

  Near term production and revenue generation has begun at a secured untouched mining block of beach and marine gravels at the well-known diamond operation at Alexkor in South Africa. This state-controlled mining area has produced 10 million carats of gem quality diamonds since 1928.

• 72,000tpa high-grade HMS potential within 12 months of approval

  The vendor of the diamond and HMS projects has made tremendous progress in developing both these interests, which come with a good in-country management team with >40 years local diamond experience.

• High grade world-class tantalum project with growing lithium potential

  Tantalum is one of the rarest elements on the planet and Aftan’s partners are large US electrical equipment companies ready to receive shipments.

• Risked conservative NPV suggests upside of over 200%

  Our conservative valuation shows the potential. We initiate coverage of Kazera with an initial target price of 2.50p and Conviction Buy stance.