We are initiating coverage on NST with a BUY rating and set a A$16.50 price target. NST is currently producing ~1.6mozpa of gold from its six key operating mines. We believe production can grow beyond 2.0mozpa in the next four years, largely due to increased output from KCGM. A pathway to 1.0mozpa at KCGM also looks clear and mining higher grades in the Super Pit have the potential to deliver beats to near-term guidance. NST can fund this impressive growth outlook, which is equivalent to a 5-year production CAGR of ~7%, from cash flow and cash reserves.
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