ACG Metals Ltd (LSE:ACG, OTC:ACGAF) is quietly building an exciting copper growth story, centred around its Gediktepe polymetallic mine in Türkiye.
In a nudge to investors, Berenberg kicked off coverage with a 'buy' rating and a price target of 720p, suggesting about 40% upside from current levels.
Gediktepe is already producing strong cash flow from gold and silver, thanks to near-record prices.
But the big move is its fully funded $146 million expansion into copper and zinc, expected to start production in early 2026.
Berenberg highlights that this is a brownfield project, meaning it benefits from existing infrastructure, which lowers execution risk and keeps capital costs down.
The expansion contract is fixed-price, protecting ACG from budget blowouts. Plus, ACG uses an unusual “owner-builder” model, aligning incentives with the contractor to further reduce risks.
Geographically, Gediktepe is well placed with good access to ports and a reliable local workforce.
The company has also secured offtake deals with major commodity traders like Glencore and Traxys, adding confidence to the quality and marketability of its future copper and zinc concentrates.
Berenberg values Gediktepe at $333 million, well above the $179 million ACG paid last year.
It sees plenty of room for value growth as the copper expansion ramps up and the company executes its roll-up strategy to build a bigger copper producer.
The share price hasn’t yet caught up with these fundamentals, making it an attractive entry point, according to Berenberg.
Copper is the right commodity at the right time. Demand is accelerating from electrification, construction and AI, while supply is tightening due to exploration challenges and rising costs. Berenberg expects ACG’s growing copper exposure to pay off handsomely.
In short, Berenberg believes ACG Metals has a solid base, clear growth drivers and a strong leadership team. The investment bank sees the company well positioned to deliver on its expansion and M&A plans, potentially rewarding investors with a re-rating in the coming years.
In afternoon trading, the shares were up 3% at 544p.