AltynGold and An Outsider's Advantage

In 1982 a Canadian businessman named Pierre Lassonde developed a way for precious metal miners to raise finance in order to fund mine development. The premise was straightforward enough. A financing company would provide funding to a miner in exchange for a percentage of the profits or income generated, usually based on the level of production.

The benefit was that an investor could get exposure to gold mining without having the responsibility for further equity commitments.

At the time, this financing method in truth wasn’t totally new. The method was well established in the US oil and gas sector. Lassonde had an ‘outsider's approach' which led him to this opportunity in the gold mining space. The royalty business Lassonde set up, Franco-Nevada, has been the world’s largest precious metal royalty company since. Demonstrating how an outsider’s view (and being early) can be advantageous.

AltynGold: The Jurisdiction Risk

AltynGold plc, an overlooked gold miner, is based in a jurisdiction most analysts won’t touch. Asset managers and banks are still searching for the next ESG, ‘impact’ or private credit investment that fits seamlessly into a glossy brochure.  

An outsider however, away from the constraints around consensus and relative performance, sees mispriced risk. As an investment jurisdiction, Kazakhstan is out of sight and out of mind from the main investment centres of London and New York. Few are looking at the country.

Being a post-Soviet State, the mention of the country invokes visions of Belarus, Ukraine or other struggling nations looking to boost its fortunes. However the Land of the Great Steppe has proven to be the strongest growing former Soviet satellite, and its location offers opportunities being in the heart of East Asia.

Indeed its central bank has been an underdog in the race to accumulate gold, being the 4th largest purchaser in 2025. Albeit these official statistics likely underestimate China’s activity (listed as 5th), but the strategic shifting in reserves is clear.

Growth

AltynGold’s main strategic objective is in reaching mid-tier status, which 100koz annual production would be generally seen as the beginning of that. Teren-Sai is seen as the principal lever to transition to that level of production.

Through this lens we can start to see the valuation anomaly that AltynGold presents. Hecla mining produces 140koz as well as a large silver component.

Granted it is not a perfect comparison as Hecla has more early stage exploration, but its valuation is circa $12.0bn. Hecla produces three times the amount of gold currently, yet has roughly 20 times the valuation compared to Altyn’s lowly £320m equity value.

Yes, Teren-Sai is a development which introduces speculative risk which must be priced in but even allowing for this the valuation is out of sync with comparables. In any event, management have stated that there is an expectation for the full permit to be issued in 2026 to 2027. This would move Teren-Sai from a development asset to a productive one.

Specific timing guidance like this is unusual in itself, in that when a specific near term time frame is specified it more often indicates a high degree of intention and confidence that the permit issuance is a fait accompli of sorts. This would make sense, as the Kazakh central bank is in an accumulation phase and AltynGold has a right of first refusal contract with the bank, which gives it strong networking effects.

AltynGold today is valued primarily on its Sekisovskoye cashflows. The market gives little to no explicit value to Teren-Sai. Therefore, an investor could buy AltynGold equity now, getting Sekisovskoye at replacement cost and Teren-Sai (with 1.4moz in gold reserves) for nothing.

Longevity and Alignment

Without having to worry about detailed year on year returns, or being pressurised by external and for the most part short-termism asset managers, the controlling family ownership can focus on developing long term value. Sekisovskoye is assessed as having a 60 year life span which is hugely significant and is out of line with its ‘junior’ pricing. This is the type of duration that the majors are usually attracted to.

In addition, AltynGold has a sovereign backed customer who is already committed to buy. With near limitless demand for the yellow metal. The National Bank of Kazakhstan has right of first refusal on gold purchases at market rates. AltynGold therefore has a sovereign backed client with near infinite demand (i.e. balance sheet) relative to AltynGold’s output.

So an outsider would see this as a significant de-risking that should feed through pricing risk, more of which below.

All of this combined means AltynGold's valuation represents a compelling opportunity to buy future money today at a heavily discounted price. This of course is at today’s gold prices, and excludes any future gold price increases dollar depreciation, which with the current debt problem is a near certainty.

Economic Value Added - 2025 Forecast

The interpretation of the economic value added analysis shows a few distinct points.

• First, AltynGold is comfortably exceeding its cost of capital.
• Net debt has reduced in 2025 YTD, meaning incremental enterprise value now accrues directly to equity holders.
• The cost of equity used is conservative and does not reflect the de-risking effect of the National Bank of Kazakhstan’s right of first refusal as a sovereign buyer. (In other words, it is a high hurdle).
• EVA understates true future value creation, as prior economic value has already been reinvested into Teren-Sai's development.

In short, AltynGold is creating genuine economic value for shareholders and not just accounting profits. Further increases in the gold price and value will quickly accrue to equity holders. Half year results for 2025 already show operating margins at 52.7%, which as it stands would put it number 13 in the FTSE All Share index (being 539 constituents).

Conclusion

With the outlook for gold, current EVA, implicit sovereign backing, and the sheer scale of the miner’s soon to be licenced Teren-Sai project means that the current valuation is anomalous with its prospects.

At £360.0m EV, this wouldn’t even cover the replacement cost of the assets and infrastructure, which insiders in institutional asset managers are not seeing or don’t have a mandate to see.

This is where being an ‘outsider’ is no bad thing.

The author holds shares in AltynGold. The most recent purchase was undertaken in December 2025.

PS – A further article is in the pipeline which identifies a generational investment opportunity. This time it is a PGM miner in which a preeminent European family office has taken a strategic holding.