OBM’s 3QFY24 result was weaker than we had anticipated, with gold production of 17.4koz 9% lower than our forecast. AISC were materially higher than we had forecast due to the lower volumes. Mining rates at the Riverina underground are improving, with 1,711m of development in the 3QFY24 and stoping commencing in March. The Riverina underground is OBM’s core ore source and is expected to underpin production growth to ~100kozpa. The Sand King underground is shaping up as a potential ore source, and this presents upside risk to our base case. We are reiterating our SPEC BUY rating on OBM and lower our price target 5% to A$0.38 after incorporating the 3QFY24 result.
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