Research YALTA advisory GmbHCategory: External News
Name: Auris AG
Number of shares: 30.000.000
Branche: gold exploration
Rate: 1,40 €
Rate Target: 2,50 €
Option: Strong Buy
Auris AG, Basel, Switzerland, was founded in 2009 to participate in gold projects around the world. Through its subsidiary AURIS CONGO SPRL 10 exploration licences were acquired in the world known gold belt in the east of the Democratic Rebublic of Kongo. The licence area includes 3.247 qkm (= 324.700 ha). The site locates the among geologists well-known Pangoy Ore Belt, which comprises in addition to numerous gold deposits, a huge iron ore deposits. For decades gold prospectors bring out high grade gold near the surface. In previous years, the discovery of gold in Eastern Congo has not been understood correctly by the geological way of interpretation. It has been seen as typical aluviale deposits. The reason was the missing systematic research within this difficult reachable region. Only the systematic exploration of the Moto Gold Mines Ltd. has carried out a completely new interpretation of the region.
Moto Gold, which had 70% share of a license area in the same belt, has proved 22 million ounces gold (Moto share: 15.4 million oz). The company has been adopted by a consortium of Anglo Gold Ashanti and Randgold Resources (see www.randgoldresources.com) in early 2009 for about U.S. $ 500 million, but this at a former gold price of U.S. $ 900-950 per ounce. Today, such a takeover would cost U.S. $ 1.5 - 2 billion.
This has 3 important reasons:
- The gold price is now at approx. $ 1,500 per ounce, thus approx. U.S. $ 600 higher.
- The Eastern Congo has become stabilized politically.
- The area is currently developed infrastructural in terms; so the Chinese build roads there to get to the mineral deposits.
Auris was just in time to get the 10 license blocks in 2009. As now all the major mining companies flow into this region and the gold price climbs to new heights, such large license areas are no longer available in the gold belt today. We are aware that major gold producers have made representations to Auris, as the most promising areas are contracted out in eastern DR Congo gold belt already.
After the initial prospecting and the analysis of past records now Auris is running a systematic exploration program, tackling the five known deposits. Soil samples on these deposits have revealed high-grade gold contents between 5 and 10 g / t already around the surface. These areas will be drilled soon. Based on experience at Moto Gold, geologists expect conservative at least 2 million ounces of gold per deposit, which would add up to at least 10 million ounces of potential. In addition further areas of interest exist within the large license area. As soon as the initial results of ongoing exploration will be published the Auris shares are expected to advance around the most attractive gold stocks. This is ensured not least by the shareholder-friendly policy of the company, which avoids unnecessary dilution of the share capital. Thus Auris has only 30 million shares outstanding and no options or warrants! The current main shareholders have also completed lock-up agreements for 16 million shares (53.3%), applicable for one year from the IPO.
At the current rate of € 1.40 in Frankfurt Auris has a valuation of 42 million €.
We see Auris in our initial estimation as a Strong Buy with a short-term price target of € 2.50. Medium and long termly we expect with confirmation of the expected results of exploration, a multiplication of the course.
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