Jubilee Metals Group PLC

Jubilee Metals Group PLC (LSE: JLP) is FTSE AIM All-Share Index listed company, engaged in metals processing and recovery. The Company is operating projects that are processing chrome, platinum group metals, copper, lead, zinc and vanadium. This Report covers the Key Recommendation Rationale, Conclusion, and Recommendation on the stock.

Key Recommendation Rationale – Sell at GBX 4.40

• Resistance near Current levels: JLP’s stock price crossed the Resistance (R1) which was stated in the previous report on 12 February 2025 therefore, there can be a possibility of a decline in resistance levels. Considering the market conditions and the price action, it is prudent to exit the stock.

• Limited Year-over-Year PGM Production Growth: Despite a quarterly rebound, year-to-date PGM output rose by just 3.6% to 29,606 oz (Q3 FY25), compared to 28,583 oz last year, suggesting modest volume growth over the nine-month period.

• Safety Metric Remains Elevated Despite Slight Improvement: The Lost Time Frequency Injury Rate (LTFIR) was 1.40 for Q3 FY2025, only a marginal improvement from 1.45 in Q3 FY2024, indicating that safety incident frequency continues to remain relatively high.

• Decline in Group EBITDA Despite Revenue Growth: Despite a 51.0% increase in group revenue to US$141.5 million (H1 FY25), group EBITDA declined by 6.8% to US$13.6 million, reflecting margin pressures from softer chrome prices and higher costs.

• Macroeconomic Risk: The market sentiments can remain weak in the short term due to the subdued consumer disposable income, geopolitical tensions, and political risks.

Valuation Methodology: Price/ Earnings Approach

Share Price Chart  

Conclusion

JLP may continue to experience valuation pressure due to a relatively high Lost Time Frequency Injury Rate (1.40 in Q3 FY2025), modest year-over-year growth in PGM production, a decline in group EBITDA in H1 FY2025 despite higher revenue, weaker profitability in the copper segment, and higher operating costs within the chrome division. Additionally, policy-related disadvantages and persistent inflation are likely to constrain near-term profitability. For conducting the valuation, the following peers have been considered: RIO Tinto PLC (LSE: RIO), Capital Ltd. (LSE: CAPD), etc.

Given its current trading levels, the recent financial performance, strategic investments and partnerships, market expansion and cost optimization strategies, relative valuation, and associated risks, it is prudent to exit the stock at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the Closing Market Price of GBX 4.40 as of 22 May 2025. 

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 22 May 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level which the stock is expected to reach as per the relative valuation method and/or technical analysis taking into consideration both short-term and long-term scenario.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’

Note 6: Dividend Yield may vary as per the stock price movement.