Raubex (RBX) – Site visit notes and HEPS update

The Kookfontein site visit offered meaningful insight into Bauba’s chrome and PGM operations. It also provided us with greater understanding of the production capabilities, revenue streams and potential longevity of the mining business.

Bauba’s management was highly optimistic about the future of the chrome industry, likely aided by the currently strong chrome CIF price of c. $330/t. Although we do not share management’s enthusiasm entirely, competitors such as Tharisa achieving $288/t and GPM of 26.5% in 1H24, on lower-grade Cr2O3 than Bauba, do provide a level of reassurance.

From FY26, Bauba may be able to improve returns through its PGM floatation plant and recovery business model, which could also be rolled out to Naboom from FY27. Bauba’s (and Raubex’s) future does look promising based on the potential of the chrome operations, but it relies on many ifs.

What can be reasonably assumed is that if current production remains unchanged, Bauba should be able to achieve a similar margin to that Moeijelijk has achieved on the c. 230kt concentrate it sold in FY24, which should result in a c. 6% margin uplift at Bauba. With strong growth potential from the Kookfontein mine, coupled with the solid Roads and Earthworks order book and Sanral pipeline, as well as robust growth expected from the Infrastructure segment through Australia and c. R3bn in secured renewable energy projects, the outlook for Raubex is positive.