Australasian Equities

Fat Prophets
Australasian Equities

Core

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Australia’s Leading Business Bank Firing on All Cylinders National Australia Bank’s (ASX: NAB) is the leading business bank, and 1Q26 cash earnings were up ~6% year-on-year, while CET1 sits at 11.48%, which is well above the regulator’s minimum requirement. Two consecutive central bank rate rises to 4.10% are being fully passed to borrowers, directly expanding profit margins on loans. Earnings momentum is underpinned, and I don’t anticipate the RBA will lift as aggressively over the remainder of 2026 as the market

Rio Tinto

Core

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Long-Term Bull Case Intact Despite ME Headwinds Rio Tinto (ASX: RIO) continues to see pressure with iron ore and base metal sentiment still down from Middle East economic headwinds and China demand uncertainty. The structural bull case is still there: Rio Tinto is the most diversified major miner on the ASX — iron ore, copper, aluminium, lithium (Arcadium), and titanium. Copper, in particular, is structurally undersupplied. The energy transition requires ~3x current production by 2040. Rio’s Oyu Tolgoi copper ramp-up in

St Barbara

Speculative

high

The Bigger Story Gold’s worst weekly decline in a generation has rattled the sector, and St Barbara has not been spared. The stock has shed roughly a third of its market capitalisation since our last coverage in early March, reaching A$0.545 and a market cap of A$659m. The pullback will feel painful, and the macro backdrop is unsettling from an emotional perspective. Anyone who bought gold as a safe-haven trade has been reminded that even safe havens can gap down sharply.

Northern Star

Speculative

high

Capitulation It’s been a particularly tough week for Northern Star shares. Management tested investor patience again with last Friday’s ASX filing, and then the gold price melted down, compounding the hit to the stock price. The company’s 13 March operational update said achieving even the lower end of its already-reduced FY26 production outlook would be “challenging”, with weaker-than-planned milling at KCGM and reduced mining productivity across several operating areas, particularly at Jundee, weighing on March quarter-to-date performance. January and February gold

CSL

Core

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Shortening the Supply Chain in Latin America CSL (ASX: CSL) saw its share slip despite the vaccine division signing a long-term flu vaccine supply agreement with the Pan American Health Organisation covering Latin America, with local manufacturing to be established in Argentina through partner Sinergium Biotech. The companies will invest $10 million in technology transfer on top of Sinergium’s $25 million facility expansion. The deal provides access to recurring government procurement across Latin American countries and includes pandemic preparedness capacity. The market seemed underwhelmed by the absence

Macquarie Group

Core

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Pulling the Plug on Kuwait Deal Macquarie (ASX: MQG) jumped after withdrawing from Kuwait’s $7 billion oil pipeline sale, explicitly citing the Iran conflict and Strait of Hormuz closure as reasons for stepping back. Macquarie continues to compound earnings off a well-diversified, capital-light platform, with FY25 NPAT of A$3.7 billion up 5% and a small uplift in the full-year dividend, reflecting balance sheet strength and capital flexibility. In our last tech update on the 12th of February, we noted that “Since our last update,

Austal

Core

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Defending Accounting Treatment Austal (ASX: ASB) reaffirmed that the half-year report complies with accounting standards despite an auditor qualification over US defence contract relief documentation. The order book climbed 35% to a record $17.7 billion, including $5 billion in new Australian landing craft contracts signed in February for delivery through 2038. Half-year revenue jumped 34% with operating margins expanding to 5.4%. The auditor qualification stems from confidential US defence negotiations lacking written evidence, not concerns over whether relief will be granted.

Woodside Energy

Core

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Acting CEO Confirmed Permanent Woodside (ASX: WDS) is a geared play on a tightening global LNG market, with record 2025 output of 198.8 MMboe, and solid NPAT still supporting an elevated dividend despite softer prices. With Scarborough targeting first gas by 4Q26, Trion now in the drilling phase, and the Louisiana LNG project reaffirmed as a key priority under newly confirmed CEO Liz Westcott, the growth pipeline underpins medium term volume and cash-flow upside. The Iran conflict has sent oil and gas

South32

Speculative

high

Mozal Mothballed on Power Impasse South32 (ASX: S32, LSEG: S32) shares stabilised after a -5% fall on Monday, when the diversified major confirmed the Mozal aluminium smelter in Mozambique was placed on care and maintenance on Sunday following failed power price negotiations. The closure triggers $60 million in one-off costs and $5 million in annual maintenance expenses. Six years of talks with electricity providers failed to secure affordable power beyond March as drought affected hydropower and regional costs climbed. The company already

New Hope Corp

Speculative

high

Coal Price Drop and Cost Inflation Squeeze Margins New Hope’s (ASX: NHC) net profit slumped 84% to $54.3 million for the 1H26 as average coal prices dropped 20.4% to $137.8/tonne and production costs rose 12.7%. Revenue subsequently fell to $814m from $1.02 billion. The company maintained a 10c fully franked interim dividend and extended the $100 million buyback through March ‘27 despite the drop in earnings. Production edged up to 5.6 million tonnes with higher output at New Acland offsetting weather

iShares China Large-Cap ETF (IZZ)

Core

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From Relief Rally to Slow Bull, at a Better Entry Point The escalation of the Middle East conflict and the associated disruption to Strait of Hormuz shipping routes triggered a broad risk-off move across Asia-Pacific equities in early March. The iShares China Large-Cap ETF (ASX: IZZ) has retraced sharply from its highs. We view this pullback as a buying opportunity. The structural case for Chinese large-caps is materially stronger today due to the more attractive valuation. China’s equity market and its

Orica

Core

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5M Update Shows Earnings Ahead Orica (ASX: ORI) shares were under pressure despite a trading update that revealed the first five months of FY26 showed earnings slightly higher than last year despite currency headwinds, but flagged $45-$60 million in one-off charges for litigation, supplier outages and restructuring that will hit 1H26 statutory profit. The company launched a cost-cutting programme targeting $100 million in annual savings over three years. Digital solutions earnings are tracking 20% higher, and specialty chemicals are up 15% on

Stockland Corporation

Core

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Residential Surges while Development Margins Expand Stockland (ASX: SGP) reported on 16 February that 1H26 operating profit rose 29.5% to $325 million as residential lot settlements jumped 60% to 3,168 and development margins expanded to 18.1% as a result, shares rose 2.3% on the result. More recently, on 3rd March, the company announced a 50/50 data centre partnership with US operator EdgeConneX, targeting 5-10% capital allocation or up to $1.5 billion over five years, securing 350MW of power at Victorian and NSW sites. In our last tech update on the 5th

Elders

Core

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Feedlot Sale Cuts Debt, Minimal Earnings Hit Elders (ASX: ELD) announced on 26 February the sale of their Killara Feedlot to Australian Meat Group for $195.8 million, comprising $122 million cash plus $73.8 million working capital – this was well received with shares jumping 2.8% on that day. The feedlot processes 62,000 cattle annually on 1,402 hectares near Quirindi, NSW, contributing $12.1 million to last year’s profit. Proceeds will reduce net debt below 2x earnings with minimal earnings impact of less than

Whitehaven Coal

Speculative

high

Investment-Grade Ratings Secured; Door Open to Cheaper Funding Whitehaven Coal (ASX: WHC) shares jumped 6.7% yesterday after securing better BB+ credit ratings from S&P and Fitch, and Ba1 from Moody’s, all with stable outlooks, opening access to cheaper debt markets. The company also received investment-grade BBB- ratings on proposed senior secured facilities, enabling refinancing of the $1.1 billion acquisition loan at potentially $30-40 million lower annual interest costs. The ratings reflect improved scale and diversification after acquiring Daunia and Blackwater mines, shifting

Santos

Speculative

high

Cooper Basin Project Targets $600M Lifetime Savings Santos (ASX: STO) announced this Monday their final investment decision on the $357 million Moomba Central Optimisation project, consolidating seven gas compressor stations into one electric hub to unlock $600 million in lifetime cost savings and cut production costs by up to $3 per barrel. The project targets a 15% return and a six-year payback while reducing emissions by 40,000 tonnes annually. In our last tech update on the 18th of February, we noted that “There has

Generation Development Group

Core

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Profit Surges on Record Fund Inflows Generation Development Group (ASX: GDG) recently reported underlying profit jumped 63% to $20.1 million for the 1H26 as funds under management hit record levels, with investment bonds reaching $5.2 billion and managed accounts climbing to $34.5 billion. Revenue rose 35% to $88.4 million with operating margins expanding as growth outpaced costs. The company maintained 60% market share of investment bond inflows on record gross sales of $723 million. GDG closed +3.6% higher after the result as

Collins Foods

Core

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Taking over Deutschland Collins Foods (ASX: CKF) announced yesterday that it will pay €31.1 million for eight KFC restaurants in Bavaria, Germany, and has signed agreements to open 45-90 new stores across three German states by 2029. The Bavarian outlets generate €28.2 million annual revenue at higher margins than existing German stores. The company refocused their Dutch operations and will hand marketing back to brand owner Yum! in January 2027. Australian same-store sales rose 2.7% year-to-date while German sales climbed 4.5%.

CSL

Core

medium

Illinois Expansion Targets 2031 Completion CSL (ASX: CSL) announced yesterday a $1.5 billion expansion of its Illinois plasma manufacturing facility, adding 330,000 square feet and 300 permanent jobs to bring the entire US plasma value chain onshore by around 2031. The project will incorporate new yield-enhancing technology to extract more immunoglobulin from each litre of plasma, targeting 100% of US demand for key brands once operational. This follows over $3 billion already invested in US operations since 2018. Shares were roughly

Fortescue

Speculative

high

Copper Acquisition and Solar Project Advance Fortescue’s (ASX: FMG) C$139 million acquisition of Alta Copper secures 100% ownership of Peru’s Cañariaco copper project, and the company is also starting construction on a 440MW solar farm at Solomon Airport in the Pilbara. The solar plant will be Western Australia’s largest and provide one-third of the capacity needed to hit the company’s operational emissions target. Management will take a staged approach to Cañariaco through technical reviews and community engagement rather than immediately deploying capital.

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