Jan Castro, chairman of Sierra Rutile (SRX), obviously agrees with the IC's contention that the company is fundamentally undervalued despite the ongoing slump in titanium feedstock minerals.
Certainly, there has been plenty to applaud on the operational front with the commissioning of the Lanti dry mining project coming in on time and below budget. As a result, the company remains on track to meet this year’s rutile production target of 125,000 tonnes. Titanium prices should benefit from the gradual recovery underway in the US economy, after a prolonged period of de-stocking. This should eventually translate into higher valuations for Sierra Rutile on the basis of its expanding resource base. The company added an additional 39,300 tonnes of rutile, and 17,300 tonnes of zircon to its resources over the first six months of this year.
Mr Castro is no doubt mindful of the pipeline of potential projects in the offing, having parted with £313,500 for an additional 627,500 shares in the company. Westhouse Securities has just initiated coverage of Sierra Rutile with a 'buy' recommendation and a target price of 70p a share. The shares have risen by 8p above the chairman's purchase price of 50p, but we feel there's still plenty of potential upside on offer and, on a forward PE ratio of 8, we maintain our buy recommendation.
The successful outcome to the long-running Excalibur Ventures contractual dispute removed a major stumbling block from the path of Gulf Keystone Petroleum (GKP). There would have been negative implications for existing shareholders if Excalibur had won the case, including a probable dilution in net production. It wasn't to be, and now GKP will be able to recoup substantial legal costs through a £17.5m security bond that was lodged by Excalibur with the English Commercial Court.
The company also had to endure a rather public boardroom spat in the lead-up to the decision, and John Bell - one of the non-executive directors subsequently appointed to the board - has established a maiden holding through the acquisition of 72,200 shares at 201p apiece. Following the Excalibur decision the board is again intent on pursuing a move to the main market of the London Stock Exchange, and there is renewed speculation that GKP could become a takeover target - with China's Sinopec touted as a possible suitor. According to Canaccord, GKP will need to outlay around $700m (£428m) to develop its giant Shaikan field over the coming years, but it's likely that this will involve a combination of increased debt with off-take agreements. At 200p, we still view the shares as a 'buy'.
BUYS:
| Company | Director | Date | No of shares | Price (p) | Value (£) | Holding (shares) | Holding (%) |
|---|---|---|---|---|---|---|---|
| Aberdeen All Asia Investment Trust | Karen Brade | 13 Sep 13 | 1,400 | 364 | 5,096 | 1,400 | 0.01 |
| Afren | Dr Osman Shahenshah (ce) | 12 Sep 13 | 400,777 | 146.09 | 585,495 | 5,895,319 | 0.54 |
| Afren | Egbert Imomoh (ch) | 12 Sep 13 | 700,866 | 146.09 | 1,023,895 | 5,404,411 | 0.50 |
| Afren | Shahid Ullah (coo) | 12 Sep 13 | 114,524 | 146.09 | 167,308 | 4,645,722 | 0.43 |
| Afren | Darra Comyn (fd) | 12 Sep 13 | 230,008 | 146.09 | 336,019 | 573,598 | 0.05 |
| Alliance Trust † | Karin Forseke (ch) | 12 Sep 13 | 10,000 | 435.4 | 43,540 | 94,181 | 0.02 |
| Amara Mining | Peter Hain MP | 16 Sep 13 | 29,010 | 18.8 | 5,454 | 82,372 | 0.05 |
| Amiad Water Systems | Simon Olswang | 17 Sep 13 | 5,000 | 315 | 15,750 | 24,500 | 0.11 |
| Asian Total Return Investment Co | Christopher Keljik | 18 Sep 13 | 1,908 | 182.25 | 3,477 | 67,139 | 0.09 |
| Avanti Communications | John Brackenbury (ch) | 19 Sep 13 | 35,000 | 242.8 | 84,980 | 485,630 | 0.46 |
| Berkeley Group Holdings (The) | GJ Fry | 18 Sep 13 | 1,000 | 2,055 | 20,550 | 991,454 | 0.74 |
| Betfair | Zillah Byng-Maddick | 13 Sep 13 | 2,500 | 1,052 | 26,300 | 2,500 | 0.00 |
| British Sky Broadcasting | Adine Grate | 18 Sep 13 | 9,194 | 861.5 | 79,206 | 9,194 | 0.00 |
| British Smaller Companies VCT | Philip Cammerman | 12 Sep 13 | 11,187 | 88.5 | 9,900 | 55,801 | 0.11 |
| Cello | Mark Scott (ce) | 18 Sep 13 | 15,200 | 64.04 | 9,734 | 921,069 | 1.12 |
| Coalfield Resources | Jonson Cox (ch) | 12 Sep 13 | 350,000 | 5 | 17,500 | 1,343,890 | 0.22 |
| Conygar Investment Company (The) | Preston Rabl | 16 Sep 13 | 3,416 | 126 | 4,304 | 895,480 | 1.01 |
| Conygar Investment Company (The) | Preston Rabl | 19 Sep 13 | 250,000 | 128.5 | 32,150 | 1,145,480 | 1.29 |
| Corac | Jon Carter (cfo) | 16 Sep 13 | 250,000 | 12.86 | 32,150 | 250,000 | 0.08 |
| EMIS * | A McKeon | 13 Sep 13 | 1,626 | 663 | 10,780 | 1,626 | 0.00 |
| EMIS * | PJ Southby (cfo) | 13 Sep 13 | 4,878 | 663 | 32,341 | 4,878 | 0.01 |
| Enteq Upstream | Robin Pinchbeck | 17 Sep 13 | 30,000 | 58.4 | 17,520 | 337,204 | 0.57 |
| F&C Capital & Income Investment Trust | Sharon M Brown | 18 Sep 13 | 1,500 | 262 | 3,930 | 1,500 | 0.00 |
| Gulf Keystone Petroleum | John Bell | 19 Sep 13 | 72,200 | 201 | 145,122 | 72,200 | 0.01 |
| Heritage Oil | Gregory Turnbull | 12 Sep 13 | 50,000 | 187.47 | 93,735 | 550,070 | 0.22 |
| India Capital Growth Fund | FC Carr (ch) | 12 Sep 13 | 30,000 | 30.3 | 9,090 | 120,000 | 0.16 |
| Johnston Press | Camilla A Rhodes | 18 Sep 13 | 19,317 | 14.5 | 2,801 | 451,421 | 0.07 |
| Johnston Press | S van Rooyen | 18 Sep 13 | 20,572 | 14.5 | 2,983 | 26,931 | 0.00 |
| Johnston Press | MA Pain | 18 Sep 13 | 21,889 | 14.5 | 3,174 | 667,918 | 0.10 |
| Johnston Press | AR Marshall | 18 Sep 13 | 27,749 | 14.5 | 4,024 | 710,789 | 0.11 |
| Johnston Press | K Aamot | 18 Sep 13 | 28,290 | 14.5 | 4,102 | 638,947 | 0.10 |
| Johnston Press | ISM Russell (ch) | 18 Sep 13 | 63,442 | 14.5 | 9,199 | 4,098,674 | 0.61 |
| Maven Income and Growth VCT 6 | William Nixon | 12 Sep 13 | 25,000 | 40 | 10,000 | 368,184 | 6.93 |
| Mwana Africa | Yat Hoi Ning | 12 Sep 13 | 84,983,260 | 1.57 | 1,334,237 | 373,133,544 | 27.44 |
| Norcon | Trond Tostrup (ch) | 18 Sep 13 | 100,000 | 15.95 | 15,950 | 372,222 | 0.91 |
| Norcon | Stephen Preston (ce) | 18 Sep 13 | 10,000 | 15.3 | 1,530 | 77,377 | 0.19 |
| Orosur Mining Inc † | John Walmsley (ch) | 13 Sep 13 | 140,350 | 14.25 | 20,000 | 140,350 | 0.18 |
| Oxford BioMedica | Dr Andrew Heath | 18 Sep 13 | 100,000 | 2.58 | 2,580 | 600,000 | 0.04 |
| Oxford BioMedica | Timothy Watts (cfo) | 12 Sep 13 | 400,000 | 2.5 | 10,000 | 3,682,829 | 0.26 |
| Pan African Resources | J Loots | 17 Sep 13 | 50,000 | 14.25 | 7,125 | 231,575 | 0.01 |
| Plant Health Care | James Ede-Golightly | 20 Sep 13 | 21,000 | 69 | 14,490 | 184,000 | 0.26 |
| Premier Oil | IJ Hinkley | 20 Sep 13 | 9,234 | 332.99 | 30,748 | 13,324 | 0.002 |
| Reconstruction Capital II | I A Florescu | 16 Sep 13 | 200,000 | 23 | 46,000 | 9,749,529 | 9.75 |
| Sage Group (The) | NA Berkett | 16 Sep 13 | 28,000 | 357.32 | 100,050 | 28,000 | 0.00 |
| ServicePower Technologies | Lindsay Bury (ch) | 17 Sep 13 | 400,000 | 4.4 | 17,600 | 9,262,599 | 4.63 |
| ServicePower Technologies | Lindsay Bury (ch) | 16 Sep 13 | 600,000 | 3.875 | 23,250 | 8,862,599 | 4.43 |
| Shanta Gold | Paul Heber | 18 Sep 13 | 64,572 | 13.76 | 8,885 | 450,000 | 0.10 |
| Sierra Rutile | Jan Castro (ch) | 21 Sep 13 | 627,500 | 50 | 313,750 | 2,312,250 | 0.45 |
| Sierra Rutile | Michael Brown | 21 Sep 13 | 35,000 | 50 | 17,500 | 285,000 | 0.05 |
| Tarsus | Gary Marshall | 16 Sep 13 | 500 | 226 | 1,130 | 3,000 | 0.00 |
| Tarsus | Gary Marshall | 16 Sep 13 | 2,500 | 225 | 5,625 | 2,500 | 0.00 |
| TLA Worldwide | Bart Campbell (ch) | 16 Sep 13 | 82,500 | 30 | 24,750 | 1,360,016 | 1.55 |
| Volga Gas | Stephen Ogden | 17 Sep 13 | 100,000 | 85 | 85,000 | 205,000 | 0.25 |
| Waterlogic | Peter Cohen (ce) | 20 Sep 13 | 50,000 | 127 | 63,500 | 50,000 | 0.06 |
| Waterlogic † | Jeremy Marshall | 16 Sep 13 | 30,000 | 119 | 35,700 | 30,000 | 0.04 |
| Weather Lottery (The) | Lord Razzall (ch) | 16 Sep 13 | 46,000,000 | 0.15 | 69,000 | 80,965,986 | 7.23 |
SELLS:
| Company | Director | Date | No of shares | Price (p) | Value (£) | Holding (shares) | Holding (%) |
|---|---|---|---|---|---|---|---|
| 888 Holdings | Aviad Kobrine (cfo) | 16 Sep 13 | 685,390 | 159.51 | 1,093,266 | 3,763,611 | 1.07 |
| Advanced Medical Solutions | Mary G Tavener (fd) | 13 Sep 13 | 315,559 | 85.056 | 268,402 | 1,773,042 | 0.86 |
| Allocate Software | Ian Lang | 17 Sep 13 | 280,000 | 101 | 282,800 | 286,437 | 0.45 |
| BBA Aviation | Simon Pryce (ce) | 13 Sep 13 | 85,000 | 321.259 | 273,070 | 989,720 | 0.21 |
| Berendsen | Kevin Quinn (cfo) | 20 Sep 13 | 25,000 | 920 | 230,000 | na | na |
| Berkeley Group Holds. | V Wadley † | 20 Sep 13 | 1,500 | 2,045 | 30,675 | 6,500 | 0.01 |
| British American Tobacco | AM Gray † | 19 Sep 13 | 6,244 | 3,388 | 211,516 | 99,467 | na |
| Craneware | Neil Heywood | 12 Sep 13 | 25,000 | 402 | 100,500 | 105,356 | 0.39 |
| Cropper (James) | N A Read | 16 Sep 13 | 5,000 | 320 | 16,000 | 24,533 | 0.28 |
| Cropper (James) | Martin Thompson | 20 Sep 13 | 3,300 | 341 | 11,253 | 26,780 | 0.30 |
| Domino Printing Sciences | Andrew Herbert (fd) | 17 Sep 13 | 8,504 | 652 | 55,446 | 48,152 | 0.04 |
| Enterprise Inns | WS Townsend (coo) | 12 Sep 13 | 100,000 | 154.3 | 154,300 | 546,555 | 0.10 |
| Ferrexpo | Viktor Lotous | 19 Sep 13 | 20,000 | 185 | 37,000 | 111,013 | 0.02 |
| First Quantum Minerals | Martin Rowley | 20 Sep 13 | 24,070 | 1,184.67 | 285,150 | 42,340 | 0.01 |
| Mucklow (A & J) | Rupert Mucklow (ch) | 17 Sep 13 | 3,000 | 438 | 13,140 | 729,451 | 1.21 |
| Mucklow (A & J) † | Rupert Mucklow (ch) | 17 Sep 13 | 3,000 | 438 | 13,140 | 726,451 | 1.21 |
| Renishaw | William Whitely | 19 Sep 13 | 2,075 | 1,904.458 | 39,518 | 4,690 | 0.01 |
| Smiths | Malcolm Maginnis | 20 Sep 13 | 11,159 | 1,397 | 155,891 | 12,863 | 0.01 |
| Vedanta Resources | Navin Agarwal | 20 Sep 13 | 50,000 | 1,174 | 587,000 | na | na |
* Placing † Spouse/connected person
Key to abbreviations: ch = chairman; ce = chief executive; cfo = chief financial officer; fd = finance director; coo = chief operating officer; cs =company secretary; md = managing director
