BRMS - Surging production driving revenue spike

BRMS recorded total revenue of USD15.84 mn from USD5.54 mn as of 1H23, surging by +185,92% yoy. It was derived by ld segment of USD14.8 mn which grew significantly by +203% yoy. BRMS's ASP inched up by +4% to USD1,928/T.Oz. Falling on finance cost successfully increased its net income to grow +45.5% yoy amidst inclining COGS. Its ld production spiked by +200% yoy, booking 7.611 T.Oz. Management stated that has completed second construction phase of Citra Palu Mineral with capacity 4,000 ton/day which has operated 1,000 ton ore per day by average as of 1H23. Its plant operated ld ore as well with 500 ton ore per day capacity. Coming to 2H23, both plants has operated 2,400 ton ore per day, expected to reach full capacity of 4,000 ton per day by early Sept'23. (Source : Kontan) Comment : We view that surging revenue mainly on ld sales reflected higher demand amidst flattish inclining on ASP. Economic slowdown becomes management's key highlight of their spiking production to support demand, in our view. However, we also see that higher global ld prices yet to reflect on BRMS's ASP. We expect BRMS likely to have further production surged in line with full capacity plant timeline which potentially increase on its revenue. Moreover, COGS spikes we see it was in line with higher production which increase its mining activities as well. While its declining CoF reflected management ability on financial deleveraging taking into account higher interest rate era.