http://www.kitco.com/charts/livegold.html

cheers GF.

looks like going to miss out on promotion again....BNZL is 90th place at the mo..

Yes ,but there are 100,not 90

Questor share-tips: Petropavlovsk is a buy
Monday was another one of negative sentiment in the market, as sovereign debt concerns combined with worries over growth in the healthier economies. Fears of a double-dip recession are growing.

By Garry White, Questor Editor
Published: 6:15AM BST 08 Jun 2010

Questor continues to believe that investors should place money in the markets on a regular basis. Quality companies with good prospects especially ones with high dividend yields should prove great investments over the medium term.

Another good investment especially at times when fear is driving the markets is gold. The price, however, is hovering close to all-time highs and this will make some investors nervous. Because of this, Questor feels that gold companies trading on lower earnings multiples are the best way to play the sector at the moment.



Questor: Hochschild will shine from silver exposureFTSE 100 company Randgold Resources is the largest pure-gold, blue-chip play. It is trading on a December 2010 earnings multiple of 43.4 times. This means the shares would be highly vulnerable to any pull back in the price of the metal.

However, Petropavlovsk formerly Peter Hambro Mining is trading on a current-year multiple of just 11.2 times, reflecting the perceived market risk of investing in Russia. But, as Questor noted in March, the company is also a play on iron ore and there was some good news on this front yesterday.

The iron-ore assets were originally spun off as Aricom in 2003, but the implosion in financial markets and in particular the mining sector after the credit crisis caused the shares to crash and the company was bought back into the group. Ultimately, this unit is expected to be spun off in Hong Kong, but climate for new issues is negative at the moment, so this is unlikely to be imminent.

The good news yesterday was that some serious Asian investors have bought into the first phase of Petropavlovsk's iron ore developments. Two Hong Kong-based funds will invest $60m (41.3m) in the initial stage of the iron-ore of the project Asia Resources Fund will put in $50m and CEF Holdings $10m. This first phase is expected to require $400m of investment in total. In March, the company secured debt financing from Industrial and Commercial Bank of China for up to 85pc of the first phase. The two funds that bought in yesterday secured the remaining 15pc.

Petropavlovsk says the investments value its equity in the non-precious metals division at $860m. This is less than the $1.5bn valuation of the operations mooted by some, but it still implies the iron ore unit is worth about $3.30 per Petropavlovsk share. This looks sensible at this stage of development and given the market backdrop. This $1.5bn valuation could be eventually be proved correct.

There is also a slight chance that Petropavlovsk will enter the FTSE 100 when the index reshuffle is unveiled later this week. However, Questor suspects that the company will miss out on promotion by a whisker again.

A company has to have a market capitalisation equivalent to the business at number 90 in the FTSE All-Share index for inclusion as a blue chip. According to analysis by City broker Fairfax, Petropavlovsk was at number 91 yesterday morning so, if gold prices hold up, the company is a real contender for inclusion later in the year.

The shares were first recommended as a buy on July 21 last year at 626.2p and they are now 96pc ahead compared with a market up 14pc.

There is no doubt that the shares will be volatile, but over the medium term the value in this business should be reflected in its share price, so Questor maintains a buy on the shares.

A new record gold price today of $1256 certainly boosting the sector

I believe that the revaluation of the Chinese yuan is bound to be very positive for POG., What with being right on China's doorstep.

POG is still primarily a gold producer, which is thus of little relevance to the chinese, though POG's iron ore and titanium sponge certainly have appeal

I don't know about that. Gold is a copmmodity, and they are one of the sectors thought to benefit most from the revaluation of the yuan. Having said that,it has fallen back sharply today.(the gold price that is.)

All the same POG doing very nicely thank you..

just bought back in at 1258 as possibly bouncing off 25 dma

Which,as coincidence would have it,the days' high for the gold price!

your bounce cynic......tripped up.,.

It happens to the best of us old boy.

me more than most...lol

not hugely, and it's a company i like in a sector i like .... also bought back at a fair bit less than i sold

still in at 10.67p so remain in profit.

well you know me .... i tend to trade, though rarely on a day basis ..... i haven't bothered to look, but i too must be well in profit on this stock too

btw, that was a great ride down to b-on-a .... and very glad i didn't pay the bill at the harrow at little bedwyn - my m8 owed me as i paid for 4 of us last time; we demolished that debt between the 2 of us - oink, oink!

Ah yes, couldn't make it...making hay whilst the sun shone.,.

From yesterdays' Telegraph
Evolution Securities slapped a "buy" rating on the stock.Charles Keriot,an analyst at Evolution,said:"We believe that Petropavlovsk is on track to start productionin the Kuranakh iron ore mine shortly and that the Malomir gold mine will also commence production in the second half.This should lead to a marked second half uplift in earnings."

Off topic, Goldfinger.

Whats your view on the reason for the fall of MML now that the oz mining tax , philippino politics and the recent dip in gold price can be discounted in my view. Which only leaves the delay in listing on the main market.

ps also eco concerns on expanding mining and anti weston terrorist groups

From this week's Shares Mag:
"When we tipped the gold producer at 11.97 (Plays, 1 Apr) we thought the company had turned a corner and was set to cast aside its reputation for missing production targets and disappointing investors. Last week's trading update (22 Jul) would initially suggest Petropavlovsk (POG) has slipped back in to bad habits, since first-half gold production was lower than market expectations at 166,300 ounces. The 2.1 billion cap subsequently lowered its full-year estimate to the bottom end of its previously forecast range of 670,000 to 760,000 ounces. We remain buyers of the stock since value has yet to be realised in its iron ore assets although we may look to lock in profits on any gold price-related rally. The company believes it will meet the full-year target but there is little room for error. Its third mine, Malomir, should start production next month. The Indian gold-buying season is almost upon us and rising precious metal prices could help to make up for reduced production volumes in order to meet profit forecasts."