http://www.321gold.com/Silvercorp Metals (TSX-V: SVM)
Market Cap on 7/25/05: C$115.27 MM
Silvercorp Metals (Formerly SKN Resources) is an emerging silver producer in China. SVM is advancing its Ying Project to formal production. In the mean time, it has been shipping hand sorted ore from the 3 shafts being sunk as part of mine construction directly to smelter. That was possible due to phenomenally high grades of silver (up to and over 100 ounces per ton) as well as lead (up to 55%) and zinc. Silvercorp reports measured and indicated resources but that is because the grades are so high that there is no need for further drilling and researching. Reportedly, silver grades are even higher at depth which makes the area similar to the Silver Valley in Idaho. Interestingly, the company is cashflow positive on an operating basis even before commencement of formal production, but it needs financing for capital expenses and to develop its other properties.
We attended the company's presentation at the IIC NY Show and were very impressed. The Silvecorp has been on the fast track with developing its Ying Project and stock price is steadily rising. Silvercorp recently closed a financing that was well oversubscribed. So much so that the company increased the financing from initial C$4.0 MM to C$6.4 MM.
The company has been getting a lot of press lately, largely due to efforts of ever so dedicated Cathy Fong, its VP of Corporate Development. We believe this company has all the ingredients needed to build on its success and there is plenty of upside potential left in the stock.
Sep 06, 2005
Sean Rakhimov
email: Sean@SilverStrategies.com
website: Silver Strategies