Blencowe Resources (BRES) has received a positive assessment from Cavendish, which reiterated its Buy recommendation and 47.9p target price following encouraging progress in high-value aerospace and defence applications for graphite from its Orom-Cross project in Uganda. The target price compares with a share price of 7.3p.
Cavendish highlighted ongoing testing by American Energy Technologies (AETC) of Orom-Cross graphite concentrates for advanced anti-radar and electromagnetic interference (EMI) shielding applications for Unmanned Aerial Vehicles (UAVs) and other defence platforms.
Blencowe is also engaged with three European advanced aerial platform manufacturers, with one potential offtake relationship described as being at an advanced commercial stage, subject to flight testing and final documentation.
Cavendish noted that indicative pricing for the specialist ultra-fine M635 material, grading 97% TGC, approaches US$20,000 per tonne. It said this demonstrated the potential for Blencowe to capture greater value by moving beyond conventional graphite concentrate sales into specialist applications.
Cavendish also highlighted that Blencowe has non-binding offtake coverage exceeding its planned 20,000 tonnes per annum Phase 1 production, while the company continues to optimise its sales portfolio towards higher-value products and build the offtake book required to support its planned 70,000 tonnes per annum Phase 2 production.
Cavendish said Orom-Cross graphite's natural electrical conductivity and hydrophobic properties could enhance its suitability for anti-radar applications, particularly for aerial platforms exposed to adverse weather conditions. It also noted that testing has progressed from laboratory work into high-fidelity demonstrations in real-world application environments.
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Cavendish's reiteration of its Buy rating and 47.9p target price underlines the potential value uplift from Blencowe's move into specialist graphite applications. Progress towards commercial aerospace and defence offtake could provide an important catalyst as the company advances Orom-Cross towards production.