We are initiating coverage on RMS with a HOLD rating and set a A$1.70 price target. The ramp up of Penny and the recent acquisition of Cue leave RMS well placed to grow production at Mt Magnet, with Cue presenting upside risk to our medium-term forecasts. However, the outlook for Edna May is less certain, with the Stage 3 cut-back required to fill an emerging production gap from FY26. The Rebecca/Roe project has the potential to more than replace Edna May, and drive group production towards 300kozpa by FY28. The timing of the Rebecca/Roe development presents a key risk to RMS’s medium-term production outlook.
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