Deccan gold mines was suggested by me several times over the last 2 years.As i always say patience pays that got vindicated again.Deccan gold from 12 since my recomendation on march 07 closed at 50rs on this friday itself.So another 4 bagger,make it an investment free asset.
ScripScan=Deccan Gold Mines
Exploration History=Exploration for gold gained momentum over the last 50 years when the GSI mapped and prospected many of the greenstone belts where extensive gold mining activity was observed. Such exploration resulted in identifying a number of areas where small and medium size gold deposits exist. Deccan Gold has made applications over several such areas which will be intensively explored upon grant of prospecting-licences to the company
Introduction:Deccan Gold Mines is engaged into the business of gold mining and gold exploration.This company has been promoted by Australian investors through a Mauritius subsidiary, where the promoters hold about 70% stake.As of now,DGM is yet to show any zero revenues and at Rs 80 crore marketcap,the company may look to be highly expensive but It is sitting on some of the most prospective blocks in the country and in case they strike gold, this Rs 80 crore of marketcap will look too small.Deccan gold has got close to about 10,000 square kilometer of blocks in different states like Karnataka, Andhra Pradesh, Rajasthan and Kerala. The company has also done a lot of exploration for the past four years and has received encouraging results from its blocks in Karnataka, particularly the Hutti block and the Shimoga belt block.
Prospects=The prospects for gold mining in India are very strong based on the following criteria:-
Ancient gold mining activity
Conclusion=India produces just 3 tonne of gold per annum as compared to 300 tonne, produced by Australia. So there is a huge unexplored potential in the sector. And with Deccan Gold being one of the first players, sitting on the most probable blocks, has got a first mover advantage.Gold mining business is just like the oil exploration business, where there is a high degree of uncertainty involved. Nobody knows whether the amount that is being spent for the exploration process will really yield any results or will have to be written off.But these company is something which can yield windfalls of gains in the long run.At 12 rs its a safe enough scrip to mint money.