Ora Banda Mining (ASX: OBM) is a new gold producer listed on the ASX. The Davyhurst Gold Project, situated northwest of Kalgoorlie in Western Australia, serves as the company’s flagship endeavour.
OBM intends to extract gold from its resources, all located within fifty kilometres of its processing facility in the town of Davyhurst. These deposits include the open pit mine in Siberia and the underground mines at Riverina and Callion.
Ora Banda share price broke out of its negative trend after the firm presented its FY22 results and disclosed some good news related to its company’s operations.
Ora Banda Mining ASX: FY22 Results
Ora Banda Mining share price is currently trading at $0.072. Over the past few weeks, Ora Banda share price has increased from 5.5 to 8 cents. The RBA’s less-than-anticipated interest rate hike prompted a sharp increase in gold prices and a decline in the Australian currency against the US dollar, which led to a 45% increase in the OBM stock value.
- OBM announced revenue of $154.26 million in FY22, an increase of 514% compared to the revenue in FY21.
- The operating expense of the company was $73.64 million in FY22.
- The company announced a net loss of $87.94 million.
- The EBITDA of the company was $6.52 million.
- At the end of the fiscal year 2022, the company had cash and cash equivalent of $27.76 million, increasing 14.6% YoY.
Ora Banda Share Price is Undervalued at the Moment
The Davyhurst Gold Project, owned and operated by OBM, is reportedly worth an estimated $180 million. This sum alone exceeds Ora Banda’s market capitalisation of $105m by a huge margin.
The 1.2mtpa processing unit at Davyhurst yielded 61koz of gold in FY22. It has $24.7 million in operating cash flow, $28 million in cash on hand, and 22koz of gold in inventory as of June 30, 2022. According to projections, gold output for FY23 will range from 56koz to 61koz.
The New MD Has Generated a Lot of Buzz in the Market
Ora Banda share price increased from 3 cents to 5 cents in July 2022 with the announcement that Luke Creagh, formerly the COO of Northern Star Resources (ASX: NST), had been hired as OBM’s CEO.
Since Mr Creagh has moved from an ASX-50 gold producer to the small-cap Ora Banda Mining, investors have high expectations that greater value may be derived from OBM’s gold holdings.
Shift in the Management Could be a Sign of Good news
The new leadership raises hopes of good news to rectify the Ora Banda share price. The company is finally facing an upswing and that positive developments are on the horizon. Ora Banda is consistently looking for additional gold discoveries at its resources in Kalgoorlie. Ora Banda Mining regularly keeps the market informed with updates on the outcomes of its continuous drilling.
Ora Banda’s bottom line will be affected by any high-grade ore discoveries made in the Davyhurst tenements because the processing plant is already operational.
Ora Banda Mining Ltd is Expanding
Since 1897, 1.4 million ounces of gold have been extracted from OBM’s Davyhurst tenements, which contain a resource base of 2 million ounces of gold at an average grade of 2.5g/t.
The business has invested over $10 million in resource definition and exploration since its equity capital offering in February 2022, emphasising higher-grade subterranean prospects inside its Davyhurst tenements. Completing this task will hopefully result in an increased resource base for the project and feedstock of better quality for the processing facility.
The company’s new CEO and the OBM’s optimism for expansion could be signs of a new increase in its valuation. Ora Banda Mining share price is already undervalued, and it is anticipated that the price of OBM stock will begin to rebound over the next few months as the firm improves the operational efficiency of its operations under the direction of the new leadership.