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Inca One Resources (TSXV: IO) Receives buy recommendation in the latest issue of the Gold Newsletter

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Inca One Resources, symbol IO on the TSX Venture Exchange, received a buy recommendation in the latest issue of the Gold Newsletter, the oldest and most respected advisory on precious metals and mining stock investing.

Additional Information:

Company: Inca One Resources
Website: http://www.incaone.com/
Stock Symbol: TSXV: IO
Date Published: Aug 7, 2014
Transcript: Available

Video Transcript:

I’m Samantha Deutscher for InvestmentPitch

Inca One Resources, symbol IO on the TSX Venture Exchange, received a buy recommendation in the latest issue of the Gold Newsletter, the oldest and most respected advisory on precious metals and mining stock investing.

Brien Lundin, Editor of The Gold Newsletter did not give a target price, but stated: “The company is currently trading at bargain basement prices and looks primed for significant appreciation once its business model gets a head of steam.”

The shares were trading at $0.17 the day the report was issued, and are currently trade at $0.16.

With 63.8 million shares outstanding, the company is capitalized at $10.2 million.

Back in June 2013, the company purchased a 25 tonne per day processing plant in the Chala, Arequipa region of Peru.

Since then, it has been test milling a small amount of ore through the facility, generating a modest amount of gold and revenue.

To modernize Peru’s informal mining sector, which is responsible for more than 20% of Peru’s gold production, to capture tax revenue, and to minimize the environmental damaging methods informal miners use to extract metal from ore, new policies have been implemented requiring informal miners have their ore processed at permitted mining facilities.

The rules also allow for a single processing plant to operate at a maximum of 350 tonnes per day.

Should Inca One grow its Chala One facility to that size, it would represent a multiple of 14 times its current processing capacity.

Subsequent to the Gold Newsletter report, the company purchased two new 50 tonne per day ball mills with the 1st scheduled into the processing circuit by the end of the 3rd quarter and the 2nd mill to be added by the end of the 4th quarter.

The mill already has sufficient tailings capacity to support the additional throughput, and the company is stockpiling initial shipments of ore for processing to have an ample supply for continuous milling by the end of the 3rd quarter.

The company is pursuing addition ore-purchase agreements with several small-scale miners who can meet or exceed the company’s gold grade target of 0.8 ounces per tonne, or 24.9 grams per tonne.

Of course the company will need financing and the first step was to secure a $5.5 million debt financing at 10%, leaving the door open for another $15 million in either debt or equity financing, should the plan prove successful.

Inca One’s management figures it can make around Cdn$8 million in annual cash flow by quickly expanding Chala One to a 100 tonne per day operation and consistently processing at least 0.8 ounces per tonne ore.

The Gold Newsletter makes a comparison to Dynacor Gold Mines (TSX:DNG) which generated US$9.1 million in net earnings in 2013, based on 76,883 ounces of gold produced at an average heads grade of 1.04 ounces per tonne.

For more information please visit the company’s website at www.incaone.com contact Edward Kelly President & CEO, at 604-568-4877.

The company’s investor relations is handled by KIN Communications, who can be reached at 1-866-684-6730 or by email at io@kincommunications.com.

For more information about the Gold Newsletter, or to receive a sample copy of their research report, visit www.goldnewsletter.com or call 1-800-877-8847.

I’m Samantha Deutscher for InvestmentPitch
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This video is for information purposes only and it is not a recommendation to buy or sell any securities