Mining companies deliver strong returns after listing on the ASX

Mining companies were amongst the top performers of the companies that listed on the Australian Securities Exchange (ASX) in first quarter 2017.

Initial public offerings (IPOs) of materials companies – which includes mining companies –  set a strong pace in the first quarter of 2017, with 10 listing on the ASX from a total 26 floats, up from two in the same period last year, according to the OnMarket 2017 first quarter IPO report.

The report revealed that IPOs returned an average of 18.3 per cent over the first quarter, outperforming the benchmark S&P/ASX 200 index by 14.8 per cent.

Materials floats provided a steady return of 4.5 per cent on the first day of listing and an average 15.7 per cent gain over the three-month period.

A standout performer over the quarter was Ardea Resources, which returned a stellar 160 per cent from its February 9 listing date to March 31.

“The rush of mining companies to float on the ASX reflects a significant turnaround from last year when few miners floated. There is now a greater investor appetite for mining sector investment given higher commodity prices and greater confidence overall in share markets,” said Tim Eisenhauer, managing director of OnMarket BookBuilds (OMB).

Ardea, a spin-out of Heron Resources, is developing the cobalt potential at its 100 per cent owned Kalgoorlie Nickel Project (KNP) in Western Australia, as well as the Lewis Ponds zinc-gold project in New South Wales.

Other mining companies that produced notable returns over the first quarter included MetalsTech (55 per cent), Cobalt Blue Holdings (25 per cent), Matador Mining (10 per cent) and Marquee Resources (7.5 per cent).

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