2 Junior Players on the Rise - AQC And DRO

3 min read | December 21, 2018 09:00 PM AEDT | By Team Kalkine Media

While small companies can be risky regarding investment as compared to big ones for the ability to resist market volatility. The returns can be exponential in smaller companies if the company has a right business model. Two junior players who are currently on the rise from a range of sectors like metals and mining to information technology are discussed as follows. AUSTRALIAN PACIFIC COAL LIMITED (ASX:AQC) – The company as at November 28, 2018, has cash at bank of AUD 1 million with the market capitalization of 35 million AUD. The company signed a strategic development agreement with Stella Natural Resources (SNR) to enable the recommencement of mining at Dartbrook with parties continuing essential conditions instance, and target transaction to close by March 2019. Relative to other producing mines and potential development assets the company has a stable and low cost of production and Strip ratio is low and stable over the life of the mine at 4.0 which is attractive. With SNR responsible for holding costs from 1 December 2018, the company’s cash burn decreases to overall corporate overheads of about $200k per month. The stock has an EPS of -0.322 AUD and shows a lack of profits. The stock price has gone up by 30.435% to trade at $0.750 due to a positive production and operational efficiency. DRONESHIELD LIMITED (ASX:DRO) – Following the execution of an agreement with Kuwait’s Zain Group announced on 5 December 2018 to the market, which is a US$7 billion leader in telecommunications in the Middle East; For DroneShield’s equipment, Zain has now placed an order. While the value is not factual to DroneShield’s overall revenues, it represents a step forward in the evolution of DroneShield’s relationship with Zain. Thales will promote and utilize DroneShield’s products in its security and defense contract bids in Spain involving counter drone aspects as the company also entered in an agreement with Thales Programas De Electronica Y Comunicaciones S.A.U. It has raised approximately $1,696,900 through a Share Purchase Plan and sought to raise $750,000 and was well-oversubscribed, with $1,561,900 in subscriptions received. DroneShield had a combined cash balance of $855,000 at 30 September 2018. The stock has an EPS of -0.041 AUD and shows a lack of profits. The stock price has gone up by 28.571% to trade at $0.135 due to constantly appearing in news and recent agreements.


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