Far East Capital Newsletter
Genmin is a next generation high grade iron ore candidate
7 Aug 2021

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Genmin is a next generation high grade iron ore candidate

Genmin (GEN) commenced trading on the ASX on 10 March 2021, after a $30m IPO at 34¢ a share, with the raising being jointly managed by Bell Potter and Foster Stockbroking. About $21m came from institutions and retail investors came up with $9m. Of the 403 million shares on issue, 67% of them are escrowed until 2023, so the market is reasonably tight.

The shares briefly touched 34¢ (the issue price) on day one, but the sellers then moved in and consistently pushed the price down to the recent low of 18.5¢. It is a good example of the risk that comes with the lack of price discovery when an IPO goes to market. In this case we understand that the bulk of the selling came from seed investors who had been in the stock for some time. They just wanted their money back. Have we seen the low? Is it time to be looking for a turnaround? Possibly.

Genmin's entire focus is on 100%-owned haematite iron ore projects in the central West African country of Gabon. It has spent US$35m over eight years defining a pipeline of iron ore projects and establishing a resource base. Over this period it has received strong support from London- based African specialist, Tembo Capital, which is now a 62% shareholder. 

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