Jefferies lowers PT on Indonesia-focussed Nickel Industries on royalty structure

Nickel Industries

11/03/2025 19:13

** Analysts at Jefferies lower price target on Australia's Nickel Industries NIC.AX to A$0.65 from A$0.80; maintain "hold" rating on stock

** The Indonesia-focussed miner slumped nearly 30% on Tuesday after reports that Indonesia is mulling raising royalties paid by mining companies from commodities like coal, nickel and copper, among others

** Brokerage says the proposed changes to Indonesia's royalty structure would see a drop of 15% in long-term earnings from current NIC projects

** Heightened geopolitical and policy instability has eroded our confidence in NIC's earnings visibility and growth outlook, says brokerage

** Jefferies flags that decreased visibility on project earnings outlook and increased policy volatility could see reduced investment in Indonesia nickel supply

** Increasing risk of working capital build, soft nickel prices and decreasing liquidity over 2025 are near-term headwinds — Jefferies

** Stock down 26.7% YTD

 (Reporting by Rishav Chatterjee in Bengaluru)

 ((Rishav.Chatterjee@thomsonreuters.com))