It
was a tough year for junior resource investors in 2013. The TSX Venture Index
slid nearly 24% during the 12-month period, while the Canadian metals and
mining sector sank 39%.
Although
November/December tax-loss selling hit resource juniors particularly hard, it
also presented opportunities for investors to buy shares in companies with good
projects at a discount.
This
appears to be case with Allana Potash
Corp. (TSX: AAA), which has seen its share price jump 36% since
December 18, 2013, to its recent price of 42 cents, including a 14% gain so far
in 2014. The company is currently developing its
previously explored, flagship Dallol potash property in Ethiopia.
A
likely catalyst for Allana’s recent stock price move was a December 27, 2013,
announcement by Russian Ambassador to Belarus, Alexander Surikov, that the new
shareholders of Russia’s Uralkali are ready to resume cooperation with
Belaruskali.
Back
in July 2013, Uralkali, the world’s biggest potash producer, said it would end
a trading alliance with Belarus in order to focus on maximizing sales volumes. The
two companies controlled more than 40% of the global potash market, and the
move was expected sent potash prices sliding by about 25%.
“As
well, the markets recognized that our company had accomplished many milestones
in 2013, all positive,” said Richard Kelertas, Allana Potash’s Senior Vice
President of Corporate Development in an interview with SmallCapPower.com,
adding that Allana was the third-best performing junior potash stock in Canada
in 2013.
“Retail
buyers also returned to the market, so our stock received a lot of buying we
think from retail investors and also interest from institutions,” he explained.
Kelertas
expects more positive developments from Allana during the first quarter of 2014,
which includes proceeding aggressively with its funding for the initial
construction of its Dallol project, including debt and equity financing.
He
also noted that the company is well funded, with $15.3 million cash in the bank
as of the end of July 2013, and said that Allana has brought its cash burn rate
down “significantly.”
To learn more about Allana Potash, you can view their initiation research report, research bulletins, analyst commentaries and CEO video interview on their SmallCapPower.com Investor Hub: http://www.smallcappower.com/companies/products/allana-potash-corp.
About Allana Potash Corp. (TSX: AAA)
Allana Potash Corp. (TSX: AAA), (OTCQX: ALLRF) is mining company with a focus on the acquisition and development of potash assets internationally. The Company is currently developing its previously explored, flagship property, in Ethiopia, the Dallol Potash Project, in Ethiopia. Allana has secured financial support from two significant strategic investors: IFC, a member of World Bank Group, and Liberty Metals and Mining, a member of Liberty Mutual Group. Allana has measured and indicated Sylvinite resources of 171.36 Million Tonnes of 30.9% KCl; inferred Sylvinite resource of 46.62 million tonnes grading 30.25% KCl; measured and indicated Kainitite resources of 701.55 million tonnes at 20.26% KCl, inferred Kainitite resource of 373.71 million tonnes of 20.35% KCl.
Disclosure
Ubika Research has received compensation from Allana Potash to provide analyst research coverage.
Except for the historical information presented herein, matters discussed in this document contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements.
Ubika Research and www.smallcappower.com (are both divisions of Ubika Corporation), and are not registered with any financial or securities regulatory authority, and does not provide nor claims to provide investment advice or recommendations to readers of this report. For making specific investment decisions, readers should seek their own advice. For full disclosure please visit: http://www.smallcappower.com/pages/small-cap-power-disclosure.
About Ubika Research
Ubika is an investment research and capital market services firm based in Toronto and Vancouver with a proven track record of identifying and launching coverage of high potential small cap stocks at an early stage, thus offering timely market insights. Its specialty is small-cap companies with a market capitalization of <$5 billion.
For additional information contact:
Vikas Ranjan, Managing Director
Email: vikas@ubikacorp.com
