Nonetheless, he figures that CNMC's share price, trading at around $1.15 on Oct 3, has further room for appreciation with a target price of $1.34, up from 70 cents previously, with twin drivers of steady prices and higher production volumes.
While demand for gold remains steady, supply growth is less so, with an increase of just 1% CAGR between 2020 and 2024, and is seen to increase just a tad to 1.1% CAGR between 2024 and 2030.
Chew expects CNMC's production volume for the current 2HFY2025 to exceed the preceding 1HFY2025, thanks to a material increase in capacity.
From a previous forecast of an increase of 26% over FY2024, Chew now expects growth this year to be 45% higher instead.
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He points out that there are seasonal fluctuations and potential variations in ore grade, which may impact recovery rates.
CNMC intends to mitigate these risks through grade blending to ensure stable output.
"FY2025 is shaping up to be a record year for CNMC, underpinned by elevated gold prices and higher production volumes.
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"With a cash balance of US$38.7 million, we expect the company to raise its payout ratio above 30% in 2H25 or enhance shareholder return through another round of special dividends," says Chew, who is projecting FY2025 patmi of 40%.
"We see further share price catalysts from a potential rise in dividend payout ratio or another special dividend in 2HFY2025, with the market already pricing in an exceptional earnings year," says Chew.
CNMC Goldmine shares changed hands at $1.16 as at 3.07 pm, up 0.87%.
