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TOC: Strong Assets with a Near Term Path to Production

What you need to know:
• Tocvan is centred around its clear and achievable objectives, looking to develop its flagship Gran Pilar Gold Project to near-term production.
• Following a maiden resource this fall, a pilot plant is expected to be permitted, constructed, and producing gold as early as H1/25.
• Beyond the pending resource estimate, the Gran Pilar Project shows significant growth potential across its 2,200ha+ land package.
• We value TOC at $0.90/share representing 100% upside.

Tocvan Ventures Corp. (TOC:CSE, TCVNF:OTC), is an exploration and development company focused on advancing high-potential mineral projects in Sonora, Mexico. Concentrating on gold and silver, Tocvan is currently developing its flagship project, the Gran Pilar Gold Project. With a disciplined approach to exploration across its large land package, Tocvan aims to build a mineral resource with large growth potential, bring online a small pilot operation, and grow organically to a junior gold-silver producer, all while maintaining a lean and efficient corporate structure and minimizing shareholder dilution. We are initiating coverage on Tocvan Ventures Corp. with a BUY rating and target price of $0.90/share.

Investment Thesis Summary
Gran Pilar Maiden Resource. Gran Pilar stands as a district-scale project covering over 2,200ha and showing strong gold-silver mineralization across the property. This fall, TOC plans to release a maiden resource on the Pilar Main Zone which covers just a small fraction of the property, leaving substantial upside going forward.

Near-Term Production. Tocvan plans to permit and construct a 50,000t pilot plant which is set to produce gold as early as H1/25. This is part of the Company’s plan to show the profitability of the asset and its ability to profit from gold production with minimal invested capital, painting a path for future growth.

Clear and Achievable Objectives. TOC prides itself on the steady execution of Company objectives, slating a course for consistent and predictable development of the Gran Pilar Project as it paints a path to production and future growth.

Strong Secondary Asset. Tocvan’s other asset, the ~2,400ha El Picacho Gold-Silver project also lies in Sonora and is proximal to two mines which previously combined for over 13Moz of gold in resources. Preliminary exploration work, including an inaugural drill program in 2022, showed the project has strong gold-silver mineralization and provides as a backstop to TOC’s Gran Pilar Project.

Strong Management & Corporate Responsibility. TOC’s management team is both experienced and strategically lean, minimizing corporate G&A. This ensures that the majority of capital is allocated towards advancing exploration and development activities. This is shown through minimal shareholder dilution since inception, having just 52M shares outstanding vs. peers with 200M+.

Valuation. Based on our model, the Gran Pilar project has an NPV (8%) of $196M or $3.81/share. We apply a 0.2x multiple onto this and adjust for TOC’s ownership in El Picacho, cash, and debt to arrive at our $0.90/share target price.