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ASX Capital Raise Roundup: Investor demand for junior explorers stays hot
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ASX Capital Raise Review is a fortnightly look at ASX capital raisings.
Should we lock ‘em down for 22 hours per day or let ‘em loose, in Melbourne? Is inflation heading out of control or is technology innovation the ultimate deflator? What are the correct answers? The simple truth is we don’t know and you should be prepared to get comfortable with uncertainty.
Regarding the inflation topic, we are seeing strong interest in those companies with commodity projects including the likes of Duke Exploration (ASX: DEX), Argonaut Resources (ASX: ARE), and Bryah Resources (ASX: BYH) which act as a hedge against inflation. Whether inflation is real or perceived, the issue is affecting current share prices positively.
One point we are noticing in the overseas markets is a more constructive setup for market technicals in small-caps. The Russell 2000 index – more representative of the overall market US small-cap market – is jumping. Blank-check Special Purpose Acquisition Companies (SPACs) are basing, and biotechs are reacting sharply to positive news announcements. This has become a stock pickers’ market.
Placements this week
| Company Name | ASX Code | Market Cap | Issue Price | Price Midday Friday | % Change from issue price to current price | Stock halted? | Sector | Industry |
|---|---|---|---|---|---|---|---|---|
| LEPIDICO LTD. (XASX:LPD) | LPD | $ 62,013,000 | $ 0.013 | $ 0.014 | 7.69% | Miscellaneous | Investment Trusts/Mutual Funds | |
| DUKE EXPLORATION LIMITED (XASX:DEX) | DEX | $ 29,942,000 | $ 0.360 | $ 0.410 | 13.89% | Non-Energy Minerals | Other Metals/Minerals | |
| NATIONAL sTORAGE REIT (XASX:NSR) | NSR | $ 2,402,000,000 | $ 2.000 | $ 2.085 | 4.25% | Finance | Real Estate Investment Trusts | |
| SUPERLOOP LIMITED (XASX:SLC) | SLC | $ 441,755,000 | $ 0.930 | $ 1.035 | 11.29% | Communications | Specialty Telecommunications | |
| MIGHTY CRAFT LIMITED (XASX:MCL) | MCL | $ 56,328,000 | $ 0.320 | $ 0.380 | 18.75% | Finance | Financial Conglomerates | |
| MANDRAKE RESOURCES LIMITED (XASX:MAN) | MAN | $ 91,056,000 | $ 0.200 | $ 0.235 | 17.50% | Retail Trade | Specialty Stores | |
| Argonaut Resources NL | ARE | $ 25,856,000 | $ 0.0075 | $ 0.009 | 20.00% | Still in Halt | Non-Energy Minerals | Precious Metals |
| GLOBAL HEALTH LIMITED (XASX:GLH) | GLH | $ 33,369,000 | $ 0.555 | $ 0.790 | 42.34% | Still in Halt | Technology Services | Packaged Software |
| WT FINANCIAL GROUP LIMITED (XASX:WTL) | WTL | $ 10,030,000 | $ 0.060 | Still in Halt | Finance | Investment Managers | ||
| AERIS RESOURCES LIMITED (XASX:AIS) | AIS | $ 393,485,000 | $ 0.175 | $ 0.2150 | 22.86% | Non-Energy Minerals | Precious Metals | |
| METALICITY LIMITED (XASX:MCT) | MCT | $ 21,493,000 | $ 0.010 | $ 0.012 | 20.00% | Still in Halt | Health Technology | Medical Specialties |
| COBALT BLUE HOLDINGS LIMITED (XASX:COB) | COB | $ 89,459,000 | $ 0.300 | $ 0.360 | 20.00% | Still in Halt | Non-Energy Minerals | Other Metals/Minerals |
| CASHWERKZ LIMITED (XASX:CWZ) | CWZ | $ 69,240,000 | $ 0.270 | $ 0.330 | 22.22% | Still in Halt | Finance | Investment Banks/Brokers |
| LEIGH CREEK ENERGY LIMITED (XASX:LCK) | LCK | $ 167,452,000 | $ 0.180 | $ 0.225 | 25.00% | Still in Halt | Energy Minerals | Oil & Gas Production |
| VANGO MINING LIMITED (XASX:VAN) | VAN | $ 66,132,000 | $ 0.067 | Still in Halt | Non-Energy Minerals | Other Metals/Minerals | ||
| OAR RESOURCES LIMITED (XASX:OAR) | OAR | $ 22,814,000 | $ 0.014 | Still in Halt | Non-Energy Minerals | Other Metals/Minerals |
Duke Exploration (ASX: DEX) raised $8m at 36c per share through Morgans Corporate. As well as this, the company plans to offer shareholders a share purchase plan to raise an additional $3mn. Eligible shareholders will be able to purchase up to $30,000 at the placement price of 36c a share. The funds from this raise will be used for resources drilling and infill at its Mt Flora project, and other deposits identified through successful exploration target drilling. Additionally, funds will be allocated for an expanded development program and metallurgical and mining studies.
Argonaut Resources NL (ASX: ARE) raised $5m through a heavily oversubscribed placement conducted by Henslow Pty Ltd. The offer price of 0.75c was a 16.7% discount to the last closing price of 0.9c per share. The use of funds will be to accelerate drilling and conduct a scoping study program at Lumwana West, drilling at its Murdie Project as well as general working capital. The raise was a very popular one on our 180 Markets platform – a clear indication that investors are excited by junior copper companies with plenty of upside.
Cobalt blue holdings limited (ASX: COB) raised $15m at 30c a share through Canaccord Genuity Limited and Blue Ocean Equites. Investors also receive a free 1 for 2 unlisted option exercisable at 45c with a 12-month expiry. The funds from the two-tranche placement will be used for engineering and mining studies, geological and sight activities as well as approval and permits. Another very popular raise on the 180 Markets platform, with investors noweagerly awaiting their allocations from the lead manager.
180 Markets latest lead-manager deal, Bryah Recourses (ASX: BYH), also made a successful return to trade.
The combined value from the 7.5c placement is now trading at 9.4c a share, due to the value of the free attaching options.
“It was really great seeing so many investors get excited by Bryah’s upcoming drilling campaign,” said Shaun Factor, co-founder at 180 Markets.
We are eagerly awaiting results from the company’s new round of metallurgical test work which will examine the potential for nickel – copper – cobalt rich sulphide in its Vanadium deposit at Gabanintha”
A general meeting, anticipated to be called in late July, will be held to approve tranche two shares as well as the options from the raise.
Mighty Craft Limited (ASX: MCL) aims to raise a total of $21.1mn at 32c a share, through a combined placement and entitlement offer fully underwritten by Canaccord Genuity Limited and Taylor Collison Limited.
Mighty Craft has entered into a binding agreement to acquire the Adelaide Hills Group (ASX: AHG) for a total consideration of $47m. The combined group of Might Craft now expects to deliver $78.7m of Revenue in FY22 along with $6m of capital EBITDA.
“Both Mighty Craft and the Adelaide Hills team are passionate about creating and growing, at scale, local craft beverage brands, said Mighty Craft’s Managing Director, Mark Haysman.
Along with increased scale, the opportunity to realise significant synergies will truly leverage our operating platform, and enhance Mighty Craft’s ability to accelerate growth of new and existing craft businesses,” Haysman said.
180 Markets was also glad to assist the lead manager of Lepidco LTD (ASX: LCD) to place the shortfall from its recently announced rights issue. Lepidco is seeking to raise a total of $9.6mn at 1.3c per share. Investors will also receive a 1 for 2 free attaching listed option exercisable at 2.6c a share.
Eligible directors intend to participate in the rights issue with LPD which is on track to commence mining in the end of 2022 on its lithium chemicals project. The completed feasibility study has shown some impressive metrics including an average annual free cash flow of US$49mn. It is anticipated that the project will have a 14-year project life and a pay back of 3 years.
The company is also currently in discussions with multiple customers for binding offtake agreements.
There is a lot of anticipated news flow and we can see why our investors were excited by participating in the shortfall from the rights issue, to pick up an interest in the company at compelling value.
Thinking about taking the IPO leap?
It has been a very successful week for new listings on the ASX. Trajin Group (ASX: TRJ) raised $90mn at $1.70 per share. They listed on the ASX on Monday June 7, and are currently trading at $2.28 — representing a return of 34% to investors over just one week of trade. The lead managers of the deal were Canaccord Genuity Limited and Ord Minnett. Congratulations to all who were involved in this raise.
Argenica Therapeutics Limited (ASX: AGN) commenced trading today on the ASX, after raising $7mn at 20c a share. AGN just reached a high of 32c per share, as at 11:30am on June 11, which represented a gain of 60% for investors that took the IPO.
Argenica is a biotech that researches and develops a neuroprotective therapeutic drugs in Australia. Its lead product candidate ARG007, a neuroprotective peptide candidate in pre-clinical trials for use in the protection of brain tissue during a stroke. The company was
Incorporated in 2019 and is based in Nedlands, Australia.
In what looks like a very busy time for listings, there are four coming up in the next week; Openn Negotiation Limited (ASX: OPN), Polymetals Resources Ltd (ASX: POL), Ozz Resources Limited (ASX: OZZ), Gefen International A.I Ltd (ASX: GFN). We have seen over the past few weeks IPOs have been performing well, and we hope to see all investors continue making good returns on these newly listed companies.
180 Markets’ recent performers
| Company Name | ASX Code | Market Cap | Issue Price | Price Midday Friday | % Change from issue price to current price |
|---|---|---|---|---|---|
| BRYAH RESOURCES LIMITED (XASX:BYH) | BYH | $ 12,918,320 | $ 0.075 | $ 0.079 | 5.33% |
| VOLT RESOURCES LIMITED (XASX:VRC) | VRC | $ 76,170,500 | $ 0.015 | $ 0.035 | 133.33% |
| PEPINNINI MINERALS LIMITED (XASX:PNN) | PNN | $ 11,207,170 | $ 0.230 | $ 0.255 | 10.87% |
| MOUNT BURGESS MINING N.L. (XASX:MTB) | MTB | $ 6,832,540 | $ 0.008 | $ 0.009 | 12.50% |
| ALLIGATOR ENERGY LTD (XASX:AGE) | AGE | $ 99,301,160 | $ 0.007 | $ 0.043 | 514.29% |
| PNX METALS LIMITED (XASX:PNX) | PNX | $ 36,521,940 | $ 0.006 | $ 0.009 | 50.00% |
| REDSTONE RESOURCES LIMITED (XASX:RDS) | RDS | $ 12,222,980 | $ 0.012 | $ 0.018 | 50.00% |
| KORE POTASH PLC (XLON:KP2) | KP2 | $ 30,299,620 | $ 0.020 | $ 0.017 | -17.50% |
| ECLIPSE METALS LIMITED (XASX:EPM) | EPM | $ 42,107,050 | $ 0.015 | $ 0.020 | 33.33% |
180 Markets was established by investors for investors, and has become Australia’s leading deal sharing platform, with a difference. In just 12 months, 180 Markets has established a 1800+ strong investor base that has enjoyed access over 650 placements on the ASX, including more than 30 placements where 180 Markets has been lead manager.
If you are interested in Placements, IPOs and RTOs sign up at www.180markets.com.au.
This article was developed by 180 Markets, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
