Shore Capital has reiterated its base case net asset value of 18.8p per share for Vast Resources PLC (LSE:VAST, FRA:D9A), well above the current 4.84p, citing the miner's transformative reverse takeover of the Aprelevka gold and silver assets in Tajikistan.
The valuation represents substantial upside against the recent closing price of 6.25 pence, with a further upside scenario of 31.7 pence per share upon converting historical resources into official reporting standards.
Under the agreement, Vast Resources, the AIM-listed mining company, acquires a 49% stake in the Aprelevka operations from Gulf International Minerals, while the government of Tajikistan retains the remaining 51%.
The transaction is expected to give Vast an immediate production contribution of approximately 11,000 ounces of gold and 130,000 ounces of silver.
Located in the prolific Tien Shan Gold Belt in northern Tajikistan, the project encompasses four active mining licences that hold extensive historical Soviet-era exploration data.
Restarting and ramping up the Soviet Tailings facility, requiring approximately $500,000 of capital expenditure, could potentially generate $1.044 billion of post-tax free cash flow over four years.
Base case production is modelled at 1.7 million gold equivalent ounces between financial year 2027 and financial year 2037 across the combined open-pit and underground operations.
The assets could deliver cumulative revenue of $1.9 billion and earnings before interest, tax, depreciation, and amortisation of $1.39 billion between financial year 2027 and financial year 2030.
The company’s balance sheet is supported by a recent £7.8 million equity placing and a $10 million loan facility from Glencore International, the diversified natural resources group.
The remaining historic Zimbabwe diamond parcel is valued at approximately £9 million to £15 million, with any proceeds expected to help repay outstanding debt.
In afternoon trading, the shares were up 61% on the morning's update.
