KGI Securities (Singapore) Pte. Ltd., December 2, 2025
Excerpt from KGI Securities report.
Report Summary
- KGI Securities maintains an OUTPERFORM rating on Fortress Minerals but lowers the target price to S\$0.27, reflecting a more cautious outlook due to structurally softer iron ore prices expected through 2030 and the delayed contribution from the Mengapur project.
- Recent results show solid volume growth but margin pressure from lower average selling prices and rising costs, with near-term upside dependent on a strong iron ore market or faster-than-expected progress at Mengapur.
- Fortress’s realized pricing has fallen from a premium to a discount versus the iron ore benchmark, limiting margin recovery even if prices stabilize; sales growth is now driven mainly by Bukit Besi until Mengapur ramps up, likely from FY2027.
- Valuation is based on a blend of discounted cash flow (DCF) and EV/resource approaches, both cut from previous levels; the risk/reward is now seen as balanced, with key catalysts being iron ore price surprises, project progress, or strategic partnerships.
- Key risks include iron ore price volatility, regulatory and execution risks at Mengapur, operational challenges at Bukit Besi, customer concentration, and macroeconomic or FX fluctuations.
Above is an excerpt from a report by KGI Securities. Clients of KGI Securities can be the first to access the full report from the KGI Securities website: https://www.kgieworld.sg
