Original-Research: Almonty Industries Inc. (von GBC AG): Buy

Classification of GBC AG to Almonty Industries Inc.

Company Name:	Almonty Industries Inc.
ISIN:	CA0203987072
Reason for the research:	Research Note
Recommendation:	Buy
Target price:	30.00 USD
Target price on sight of:	31.12.2027
Last rating change:
Analyst:	Matthias Greiffenberger, Cosmin Filker

Sangdong enters production: exceptional tungsten pricing and expanded offtake

Almonty has reached the most important milestone in its history. Sangdong is no longer only a financed construction project: the plant began processing stockpiled run-of-mine ore in July 2026 after first ore was delivered in December 2025. The investment case has therefore moved from construction and financing risk toward the more measurable questions of throughput, grade, recovery, concentrate quality, customer acceptance and cash conversion. This is an important de-risking step and creates the basis for Almonty to develop into one of the largest non-Chinese tungsten suppliers.

The market backdrop remains exceptionally supportive. As of 14 August 2026, the Fastmarkets Rotterdam APT price averaged US$3,087.50/MTU, within a range of US$2,900–3,275/MTU and around 9.4 times the level recorded at the beginning of 2025. China continues to account for approximately 79% of global mine supply, while Western inventories remain limited and defense sourcing requirements are becoming increasingly stringent. Against this backdrop, Sangdong’s scale, high grade, long mine life and location in South Korea position it as a strategically important source of tungsten within an allied supply chain. Once the operating ramp-up has been demonstrated, these attributes should justify a valuation premium relative to conventional single-asset mining companies.

Commercial visibility has also improved materially. The amended agreement with Global Tungsten & Powders increases contracted Phase 1 volume by 40%, extends the term to 21 years and improves pricing and payability by 6.3%. Approximately 90% of expected Phase 1 output is covered. At current APT reference levels, the contracted volume corresponds to indicative annual revenue of around US$490m. This remains a price-linked run rate rather than guaranteed fixed revenue, but the agreement substantially reduces placement and qualification risk while preserving commodity price exposure.

The US$800m convertible notes are treated as debt in the equity bridge. The initial conversion price is approximately US$27.40 per share, while the associated capped-call transactions are expected to offset the conversion spread above principal up to the US$41.36 cap price, subject to their terms. As our US$30.00 target lies within this range, we model no incremental net dilution from the notes and fully reflect their principal amount as debt. The valuation uses 288.48m basic shares. Outstanding warrants and options are valued separately using Black-Scholes, and their US$30.11m economic value is deducted once from equity value. RSUs and if-converted shares are excluded from the denominator.

We forecast revenue of US$365.9m in 2026, US$1.32bn in 2027 and US$1.49bn in 2028. Adjusted EBITDA is expected to reach US$329.7m, US$1.22bn and US$1.30bn, while free cash flow increases to US$95.8m, US$694.9m and US$958.7m. The step-up reflects a partial-year Sangdong contribution in 2026, a much broader operating contribution and Phase 2 volume in 2027, and a peak ramp profile in 2028. The very high initial margins are supported by extraordinary tungsten pricing and the quality of the orebody, but they also make the forecast highly sensitive to recovery, payability and APT normalization.

Further upside should be earned through operating evidence. Stable monthly throughput, improving recovery, customer-approved concentrate, recurring shipments and visible cash receipts would validate the forecast and reduce the execution discount. The main risks are a slower commissioning curve, lower-than-expected grade or recovery, APT normalization, customer concentration, capital deployment outside the forecast and dilution if the convertible or equity incentives develop less favorably than assumed. In our view, the balance of these factors remains clearly positive, while the shares retain a high-risk classification.

You can download the research here: 20260819_Almonty_Note
Contact for questions:
GBC AG
Halderstraße 27
86150 Augsburg
0821 / 241133 0
research@gbc-ag.de
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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG und Art. 20 MAR Beim oben analysierten Unternehmen ist folgender möglicher Interessenkonflikt gegeben: (5a,7,11); Einen Katalog möglicher Interessenkonflikte finden Sie unter: https://www.gbc-ag.de/de/Offenlegung.htm
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Completion: 19.08.2026 (16:00)
First distribution: 20.08.2026 (10:00)