Stock Market Trading > ASX Australia

The Australian Stock Exchange (ASX) is the primary stock exchange in Australia. The ASX began as separate state-based exchanges established as early as 1871. Today trading is all-electronic and the exchange is a public company, listed on the exchange itself.

The biggest stocks traded on the ASX, in terms of their market capitalization, include BHP Billiton, Telstra, and the National Australia Bank. The mining sector makes up a relatively high proportion of the market, and comparatively few manufacturing stocks are listed.

The major market index is the S&P/ASX 200, an index made up of the top 200 shares in the ASX. This supplanted the previously significant All Ordinaries index, which still runs parallel to the S&P ASX 200. Both are commonly quoted together. An index of only the bigger stocks is the S&P/ASX 50.

The ASX is a public company, and its own shares are traded on the ASX. However, the corporation’s charter restricts maximum individual holdings to a small fraction of the company.

While the ASX regulates other listed companies listed on the ASX, it cannot regulate itself, and is regulated by the Australian Securities and Investments Commission (ASIC).

LINK: http://www.asx.com.au/

HFA Investments made an impressive debut on the Australian Stock Exchange yesterday with its stock leaping from $1.10 to close at $1.39. “It has been a pretty healthy day,” HFA founder and chief executive Spencer Young said. He was happy with the institutional investors who had supported the offering. HFA is a fund of hedge funds group with $2.1 billion under management. Fund of hedge funds groups invest in different hedge funds to produce a low-risk blended return. HFA’s ready acceptance by the public market reflects the growing popularity of hedge funds in Australia.

Shares in Pengana Hedge Fund Managers and Everest Babcock & Brown have recently recovered from long periods of underperformance and the global hedge fund business is doing better after a difficult 2005. The Credit Suisse/Tremont hedge fund index was up 5.46 per cent in the first three months of the year.

Mr Young thinks that his group has some distinct advantages over its peers. “We have a very strong distribution capability,” he said. The group had 15,000 investors, whom it reached through financial planners. “We have a unique business. It is the equivalent of a mutual fund in the fund of hedge funds business.” HFA’s sales force travels the country educating financial planners on the attractions of hedge funds. The rationale for the IPO was partially to fund expansion.

But it was also to crystallise the position of HFA’s senior executives, who are also among the group’s largest investors. Mr Young made more than $66 million from the float, part of which he will reinvest in a 12.6 per cent stake in HFA. The names of his colleagues stud the list of HFA’s top 20 investors. HFA was owned by MFS before the sale, and MFS remains the largest shareholder with just under 38 per cent, followed by Mr Young.

Discount accommodation website Wotif.com is set to float on the Australian Stock Exchange (ASX) through a $161 million initial public offering (IPO). Wotif said it had lodged a prospectus with the Australian Securities and Investments Commission for the IPO, under which it will offer about 85.98 million shares. That represents about 42 per cent of Wotif’s issued capital. Existing shareholders will hang on to the other 58 per cent of the company, which was set up six years ago, with chief executive Graeme Wood retaining a 25.1 per cent share. “The offer price is to be set through an institutional bookbuild within a pricing range of $1.75 to $2.00 per share,” Wotif said in a statement.

“Based on the midpoint of this range, the offer size is approximately $161 million and Wotif.com’s market capitalisation will be approximately $381 million.” Mr Wood said Brisbane-based Wotif had a low-cost, highly-focused business model that had generated strong revenue and earnings growth. “We are the Australasian market leader in the online accommodation industry, processing approximately 36 per cent of all online accommodation sales in Australia and 18 per cent in New Zealand,” he said.

The company said it expected to deliver a net profit of $15.7 million in fiscal 2006, and $19.1 million the following financial year. It has forecast revenue to increase by 41 per cent in 2005/06 to $45.3 million, and by 23 per cent to $55.8 million in 2006/07 Last financial year, the company reported revenue of $32.1 million. Wotif.com also expects to declare a fully franked final dividend of one cent a share this financial year and 8.4 cents a share in fiscal 2007 Macquarie Equity Capital Markets Ltd and ABN Amro Morgans Corporate Ltd are joint lead managers for the offer

LINK http://www.wotif.com

Independent interactive TV provider IceTV hopes to raise $4 million to list on the Australian Stock Exchange, planning to expand its services and subscriber base.

IceTV says it has priced shares at 50 cents in its initial public offering (IPO), with a minimum purchase of 4,000 shares. IceTV is similar to TiVo in the US, and allows subscribers to watch and record television without having to programme a video recorder.

The company plans to target the free-to-air market in Australia which accounts for 75 per cent of all households. It has partnered with a number of manufacturers to integrate the IceTV service into media centres and digital video recorders. Chief executive Duncan Ross said IceTV changes the way people watch television. “The family dynamic in my home has been transformed since we moved from watching TV on the network’s timetable to watching our favourite shows when it suits us,” Mr Ross said. He said listing on the ASX would be an important step in the development of the company.

“Attracting investors through the share offer will enable us to push forward with developing a range of exciting new services that will enable our subscribers to take even greater control of their TV viewing,” Mr Ross said.

 IceTV IceTV: home of iceguide, an Electronic Program Guide (EPG) for Australian free-to-air TV on your Personal Video Recorder (PVR).
www.icetv.com.au/

Gindalbie Metals Ltd (ASX: GBG) today announced that it has reached agreement with Monarch Resources Limited (ASX: MRS) to sell its Minjar gold and base metal assets in Western Australia’s Mid West region for a total consideration of $10 million.

Under the agreement, Monarch will acquire a 100% interest in the Minjar assets, including the 600,000tpa Minjar gold treatment facility and gold resources of approximately 400,000oz. All iron ore rights to the Minjar ground will be retained by Gindalbie.

The purchase price of $10 million is payable in stages, with $2.5 million payable in cash on settlement of the transaction, $2.5 million 6 months after settlement (which includes the assumption by Monarch of Gindalbie’s rehabilitation obligations at Minjar and the resultant replacement of performance bonds), and $5 million 12 months after settlement. This final amount will be paid either in cash or Monarch shares, or a combination of both.

The sale of the gold and base metal assets represents another milestone on Gindalbie’s path to become a leading independent Australian iron ore producer, confirming its sole focus on developing the Karara Project in joint venture with AnSteel, China’s second largest steel producer. Gindalbie last week announced a landmark 50:50 joint venture and funding agreement with AnSteel to underpin development of the $1 billion Karara Project.

The proceeds of the gold sale will further strengthen the Company’s cash position which, following completion of the second tranche of the $33 million share placement announced in February (which is subject to shareholder approval at a meeting on 13 April), will be approximately $40 million.

This provides a solid platform for development of the Karara Project, including Gindalbie’s share of the costs of the current Definitive Feasibility Study, ongoing resource drilling and capital start-up costs for the initial hematite phase of the operation (which is due to commence in early 2007). The recently announced AnSteel Joint Venture addresses the funding requirements for the $1 billion Karara Concentrate/Pellet Project.

Gindalbie’s Managing Director, Mr David McSweeney, said the divestment of the non-core gold and base metal assets further reinforced the Company’s focus and commitment to its iron ore strategy, with the proceeds of the sale further strengthening its funding position.

“This puts us in an excellent position to concentrate all of our resources onto our iron ore assets in conjunction with our new joint venture partner, AnSteel,” he added.

“We are pleased to have reached agreement with Monarch Resources regarding the Minjar assets, which comprise a high-quality tenement holding surrounding the world-class Golden Grove base metal mine, a substantial resource base and gold treatment facility which complement Monarch’s gold development strategy in Western Australia,” Mr McSweeney said.

Coal Mining Productivity  We offer a range of products and services to optimize the coal mining process, delivering blasting solutions to meet over burden displacement and coal movement targets.

Metals Mining Productivity  Whether the need is controlling ore dilution, reducing fines, optimizing ground control and fragmentation or increasing productivity, we produce total cost reduction along the entire value chain - above and below ground.

Quarry Productivity  With total fragmentation control, we deliver the right stone size for use in cement or concrete as well as in road, railway or dam construction applications - while minimizing the impact on the community.

Tunneling Productivity  Our explosives delivery systems let you load rapidly and efficiently while minimizing ground vibration, toxic fumes and overbreak.  We reduce our customers’ cycle times and assure safety in transport.

Building & Construction Productivity  We support a wide range of construction applications - from small utility contracts and pipeline spreads, through mining construction, road building and heavy civil contracts.

Seismic Productivity  With over 60 years of experience in delivering explosives for geophysical exploration, we bring innovation to the production of accurate seismic data using safe and efficient methods.

For information on products and services in Dyno Nobel Asia, Europe, Middle East, Africa and Latin America, please visit www.dynonobel.info.

Shares in the world’s second largest explosives maker Dyno Nobel rose 17 per cent upon listing as investors who missed out on the highly prized float chased the stock higher, seeking exposure to the global resources boom. The stellar debut raised questions that the issue price for the 57 per cent of the company’s shares on public offer might have been set too low, but Dyno Nobel chief executive Peter Richards shrugged off the concerns.

Sydney-based Dyno Nobel opened on the Australian Stock Exchange (ASX) at $2.78, 41 cents higher than the price paid by investors in Australia’s biggest float so far this year. The stock ended its first day of trading at $2.68, up 31 cents, and was the top traded stock with 185.53 million shares worth a total of $501 million changing hands. Mr Richards said the company’s listing was “extraordinary”. “Going into it the momentum was certainly building up but to get this level of interest and excitement is very rewarding,” he said.

The company is seen as attractive investment prospect given rising demand for explosives from miners such as BHP Billiton Ltd and Rio Tinto Ltd on the back of the China-led global resources boom. Mr Richards said the boom would continue for the next three to five years, with India expected to come in at the tail-end and support the cycle. Fat prophets senior resources analyst Gavin Wendt said while the issue price could have been set higher, it was hard to second-guess the pace of the China-led resources boom. “The goal-posts seem to be moving from week to week given that sentiment in the sector keeps on improving,” he said. “They have to draw the line somewhere.”

Dyno Nobel is second to only to Melbourne-based Orica Ltd in the manufacture and distribution of commercial explosives and has a strong presence in the two of the three largest explosives markets in the world. It was acquired by Macquarie Bank and a group of unidentified investors for $2.23 billion last September. The group held on to Dyno Nobel’s operations in Australia, New Zealand, Canada and the United States but sold the remaining businesses to Orica for $900 million. Mr Richards said Dyno Nobel would look at re-entering the markets it had exited through the sale of those assets to Orica.

“There’s no impediments for us to go back into those markets,” he said. The company’s current growth opportunities included its existing operations in the US and Australia, but its was also looking at expanding into Asia and Latin America within the next 12 months, Mr Richards said. Dyno Nobel was “well on track” to meet its prospectus forecast after a strong first quarter, he added. It has forecast proforma revenue of about $US1.19 billion for fiscal 2006 compared to $US1.14 billion in 2005 under an equity method accounting basis.

LINK http://www.dynonobel.com

Gold Mining and Exploration in Western Australia

An alloy is a blend of elements forged into a metal with unique properties.  Alloy Resources Limited (‘Alloy’) is a blend of dynamic people and quality gold projects that combine to form a unique company.

Alloy is an Australian based mining and exploration company whose current focus is gold in Western Australia.  Alloy is aiming to recommence mining operations at the Comet Gold Mine, expand its resource base through aggressive exploration at all projects, and begin mining at the Horse Well gold project.

LINK: http://www.alloyres.com/

Alloy Resources makes positive ASX debut
New gold explorer Alloy Resources hopes to soon leave behind the explorer tag and become a fully-fledged miner via one of its advanced gold projects in Western Australia. Alloy listed on the Australian Stock Exchange at a 40 per cent premium, which was pulled back to a smaller margin by the end of its first day of trading. Shares opened at 28 cents and closed at 21.5 cents, compared to the issue price of 20 cents.

The company has raised more than $4 million against a backdrop of booming gold prices, with many market analysts taking a bullish outlook on where it is headed. Managing director Jayson Meyers said the gold price had helped the float but it was already well backed. “I think we did well for our first day and it’s a good place to start,” he said. Alloy is chaired by nickel miner Sally Malay’s managing director Peter Harold and he said the new company was well placed for a junior outfit.

“The company is in a strong position for a small gold exploration and project development company with a resources base of approximately 218,000 ounces,” he said. Dr Meyers said he expected the main project, Comet, would be in production by the end of the calendar year. Comet-Webb has a resource of 165,000 ounces and he said the company was initially targeting 250,000 ounces before eyeing half a million ounces.

The project is within trucking distance to Harmony Gold’s Mt Magnet mine and Dr Meyers said Alloy was in discussions with Harmony about a possible toll-treating arrangement. Another high priority project is the Horse Well project where there is a resource of 53,000 ounces. The company also has two grass root exploration properties in the North Kimberley region and near Kalgoorlie.

The Macquarie Bank-backed European Investors Global Property Trust (EIG) has debuted at a five per cent premium to its issue price. After a slow start following its listing at 1100 AEST, the units in the $30.1 million initial public offering (IPO) began trading on the Australian Stock Exchange (ASX) at $1.05, above the $1.00 offer price.

EIG was set up by the Australian investment bank to invest in listed property companies and trusts in Europe, North America and high growth Asian markets. The funds will be managed by New York-based European Investors Inc, which looks after about $US2.2 billion in assets. According to Macquarie, the fund is among the first listed trusts in Australia to provide access to a portfolio of global property securities.

The European Investors Global Property Trust (EIG) provides direct access to a portfolio of global property securities managed by a premium boutique manager, European Investors Inc (EII). Units in EIG are expected to be listed on the ASX. EIG will be initially launched as an IPO and forms part of the rapidly growing Macquarie Professional Series. EIG’s investment objective is to pay quarterly distributions and seek long-term capital appreciation, measured in Australian Dollars, through an exposure to listed securities of companies and trusts in the real estate industry around the world (excluding those listed in Australia)

LINK >>