- RE-ITERATE BUY Entry – 0.51 Target – 0.56 Stop Loss – 0.48
- Valuable coal. GERL owns four coal mining concessions in Indonesia. The group reported a JORC VALMIN valuation of US$726mn for its coal reserves (as at 31 August 2021), and had cash of US$191mn (as at end-Dec 2021). This compares favourably against its current market capitalisation of around US$543mn (S$733mn).
- A great year…The group reported its highest coal volume sales of 11.4mn tonnes in 2021, which generated sales of US$642mn (+109% YoY) and net profit of US$179mn. This was mainly on the back of higher coal prices as ICI4 rose and averaged US$65.85 in 2021.
- …and an even greater year ahead. Indonesia’s coal miners are expected to benefit from the tight supply amid the disruptions to Russian supply due to sanctions. The ICI4, Indonesia’s coal benchmark for 4,200 GAR coal is once again trading above US$100 per tonne. (see coal price chart below)
- Juicy dividends and cheap valuations. GERL will be paying out a final dividend of 5.0 Sing cents, which is pending approval at the upcoming AGM. This brings total full-year 2021 dividends to 9.0 Sing cents, or US$93.5mn. GERL currently trades at
SGX IHS McCloskey Indonesian 4200kc GAR FOB Thermal Coal Futures
