Almonty Industries: Strategic Positioning Offsets Financial Losses

Analysts raise Almonty's price targets as its South Korean tungsten mine starts up, positioning it as a key supplier for Western defense under new U.S. law.

A net loss exceeding CAD 160 million would typically unsettle investors. However, for Almonty Industries, this week saw several financial institutions raising their price targets on the company's stock. The explanation for this counterintuitive reaction is found within a mountain in South Korea and is amplified by shifting U.S. geopolitical strategy.

U.S. Defense Policy Creates a Strategic Opening

A significant driver for the bullish outlook stems from recent U.S. legislation. The National Defense Authorization Act mandates a decoupling from Chinese and Russian tungsten sources by January 1, 2027. This move positions Almonty’s newly operational South Korean asset as a future critical supplier for Western defense and semiconductor industries, independent of the current dominant source. China presently controls over 80% of global tungsten supply.

Operational Milestone Reached in Sangdong

The company announced the formal completion of the first phase of commissioning at its Sangdong tungsten mine on March 16. This facility is engineered to process 640,000 tonnes of ore annually. Market researchers viewed this development as a pivotal operational catalyst. Analysts at Alliance Global Partners noted the start-up could potentially quadruple corporate production by year-end, prompting a series of revised forecasts:

• B. Riley Securities: Target lifted from $17.00 to $23.00 (Buy rating)
• Alliance Global Partners: Target increased from $14.00 to $19.25
• Oppenheimer: Target adjusted from $16.00 to $19.00

Market Dynamics and Financial Performance

The mine's launch coincides with a tightening global market. In Europe, prices for Ammonium Paratungstate (APT) have recently climbed beyond $2,250 per metric ton unit. This rally is fueled by structural supply deficits and increasingly stringent export controls from China.

This strategic potential currently overshadows the company's weaker financial results for the 2025 fiscal year. Revenue of CAD 32.5 million fell short of analyst consensus estimates of CAD 41.5 million, pressured by lower sales volumes from the Panasqueira mine in Portugal. The substantial net loss of CAD 161.9 million was largely attributable to non-cash derivative valuation losses of CAD 97.4 million.

Future Expansion Plans

Following the initial phase investment of $100 million, management's focus is shifting to the planned expansion. The second development stage at Sangdong, targeted for 2027, is designed to double annual ore capacity to 1.2 million tonnes, further solidifying the company's role as a major non-Chinese tungsten producer.