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Beaufort Securities Breakfast Alert - South Korea announces Bitcoin ban plan

Beaufort Securities Breakfast Alert - South Korea announces Bitcoin ban plan

Markets

Europe
The FTSE-100 finished yesterday's session 0.23% higher at 7,748.51, whilst the FTSE AIM All-Share index was down 0.18% at 1,066.05. In continental Europe, the CAC-40 finished 0.35% lower at 5,504.68 whilst the DAX was down 0.78% at 13,281.34.

Wall Street
Last night in New York, the Dow Jones fell 16.67 points (0.07%) to close at 25,369.13. The S&P-500 dropped 3.06 points (0.11%) to end at 2,748.23 and the Nasdaq lost 10.01 points (0.14%) to stand at 7,153.57.

Asia
In Asian markets this morning, the Nikkei 225 was down 0.33% at 23,710.43, the Hang Seng was 0.01% higher at 31,078.29 and the Shanghai Composite was trading 0.10% up at 3,425.34.

 

Oil
In early trade today, WTI  was down 0.11% at $63.50 per barrel and Brent was 0.16% lower at $69.09 per barrel.

 

 Headlines

South Korea announces Bitcoin ban plan
South Korea is planning a law to ban cryptocurrencies such as Bitcoin being traded through its exchanges. The justice minister said virtual currencies were causing the government "great concern". Meanwhile, several Seoul cryptocurrency exchanges have been raided this week in a probe into alleged tax evasion. Bitcoin and others lost about 10% of their value on Thursday - but it is hard to gauge how much of that was the result of events in South Korea. Given the low levels of trading and relatively small number of people holding virtual currencies, wild price swings have become the norm, leading to an argument that paying too much attention to price rises and falls is a fairly futile exercise. Digital currencies such as Bitcoin have surged in value over the past year - driving a huge demand. That has led to concerns about gambling addiction as inexperienced investors try to ride the wave. "There are great concerns regarding virtual currencies and the justice ministry is basically preparing a bill to ban cryptocurrency trading through exchanges," said Justice Minister Park Sang-ki. It is understood the department is preparing legislation that would allow the exchanges to be shut down. The crackdown in South Korea by authorities included a raid on the country's second largest virtual currency operator, Bithumb. "We were asked by the tax officials to disclose paperwork and things yesterday," an official at the firm told Reuters, requesting anonymity. The government had already said in December that it would apply more scrutiny to the exchanges, including moves to curb anonymous trading.

Source: BBC News

Company news

 

Amryt Pharma (LON:AMYT) 20.10p – Speculative Buy
Amryt Pharma yesterday announced that it has signed an exclusive distribution agreement for Lojuxta in Central and Eastern Europe with GryNumber Health. GryNumber is one of the leading healthcare consultancy and distribution companies in the region, with over 20 years of experience. The company estimates that there are approximately 100 patients with HoFH across this region (Austria, Croatia, Czech Republic, Estonia, Finland, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia). Lojuxta is approved for the treatment of Homozygous Familial Hypercholesterolaemia (‘HoFH’), of which, Amryt acquired exclusive marketing rights in the European Economic Area, Switzerland, Middle East, North Africa, Turkey and Israel.

Our view: Amryt continues to expand its partnerships across licensed territories! It follows exclusive distributor agreements signed recently for Lojuxta in the Kingdom of Saudi Arabia and Switzerland. At the interim results announced back in September 2017, Lojuxta generated annualised revenue of €11.5m, in a projected potential market size of approximately €100m. In light of continued progress, Beaufort reiterates its Speculative Buy rating.

Beaufort Securities provides corporate sponsored research to Amryt Pharma Plc

 Cora Gold (LON:CORA 15.50p – Speculative Buy

Cora Gold, the West African focused gold exploration company, announced that it has completed the Stage 1 reconnaissance drill programme at its flagship Sanankoro deposit in southern Mali. A multi-purposed rig was mobilised on 30 Nov 2017 and 2,800m of mixed AC (Air Core) and RC (Reverse Circulation) drilling has now been completed. Whilst assay results are expected in a few weeks, visible gold was identified in many holes suggesting widespread mineralisation along structures. Previous drilling at Sanankoro has identified two parallel and mineralised structures. A new structure (Zone C), located west of Zones A and B, has been identified through mapping of artisanal sites and surface sampling. Stage 2 drilling comprising 4000m of RC/AC and 500m of diamond core drilling has commenced and will focus on Zones A, B and C. In addition, highly prospective, drill ready targets have been identified at Tekeledougou (located 60km south of Sanakoro and 8km from Hummingbird’s Yanfolila gold plant. Drilling at Tekeledougou is expected to begin by the end of Q1 2018.

Our view: The presence of visible gold across many holes at Sanankoro is very encouraging indeed. This coupled with the identification of favourable lithologies that host mineralisation sets the tone for the pending assay results in the coming weeks. In the meantime, Stage 2 of the drilling program has commenced focusing on connecting Zones A and B as well as exploring the newly identified Zone C to the west. We look forward to the assay results from the Stage 1 drilling. In the meantime, we maintain our Speculative Buy recommendation on the stock.

Beaufort Securities acts as corporate broker to Cora Gold plc

 

Kibo Mining (LON:KIB) 5.55p – Speculative Buy
Kibo Mining announced yesterday an update on the MoU and the PPA (Power Purchase Agreement) for the MCPP (Mbeya Coal to Power Project) following its meeting with the Tanzania Ministry of Energy and TANESCO on 8 January 2018. During the meeting, the Ministry proposed a more streamlined process and procedure with firm commitments to deliver a signed MoU no later than 31 January 2018.The MoU will provide a framework within which the fundamental commercial and technical components of the PPA will be established, this is crucial for the development of the project. The PPA is expected to be completed by Q1 2018 and Kibo believes the MCPP could be in production within 36 months from financial close.

Our view: We continue to be encouraged with the sense of urgency with all stake holders to fast-track the MCPP towards finalisation of the all-important PPA. We look forward to the completion of the MoU before the end of January followed by the crucial PPA in Q1 2018. In the meantime, we maintain a Speculative Buy on the stock.

Beaufort Securities acts as corporate broker to Kibo Mining PLC

 Obtala (LON:OBT) 15.00p– Speculative Buy

Obtala yesterday announced the signing of MOU with FundInvest SA, an investment company established by the Mozambique Ministry of Land, Environment and Rural Development, to set up a joint venture company by Q1 2018. The JV’s activity will include purchasing logs (primarily from small concession holders that are otherwise illegally exported), delivery and processing of timber at sawmills within Mozambique, and the export of the resulting wood products to international markets. The aim is to combat illegal logging and promote timber processing in Mozambique. The JV will be 51% owned by FundInvest, 48% by Argento (Obtala's subsidiary) and 1% by Obtala, and Obtala does not plan to invest directly.

Our view: The MOU to establish a JV is a positive news for Obtala. Obtala will be responsible for arranging financing and make its sawmill in Nampula available for processing the JV’s timber at “market competitive” prices. Processed timber will be sole jointly, while purchasing, logistic and obtaining of government and regulatory approvals, permits and licenses will be managed by FundInvest. The agreement not only increases revenue for Obtala, it also reconfirms the Mozambican government’s intention to crack down the illegal logging which can be expected to push medium-term timber pricing upward. We retain our Speculative Buy rating on Obtala.

Beaufort Securities acts as a corporate broker to Obtala Limited

 

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