FD Capital reiterates 'buy' for Discovery Metals, maintains 72p target

London based stockbroker Fox-Davies Capital has reiterated its 'buy' recommendation for Discovery Metals (AIM: DME) following the company’s update on the quarter ended 31 December 2009. The broker said it has always been positive about the depth potential at Discovery’s Boseto copper project in Botswana and it is pleased to see that the 5 holes drilled to date all intercepted mineralisation.

Fox-Davies maintained its 72p per share target price for the AIM listed explorer.

In last week’s update, Discovery Metals revealed that Boseto’s bankable Feasibility Study is now 80% complete and remains on track for completion in March 2010. Fox-Davies said it was a very positive quarterly report and with AU$17.6m, the company has plenty of cash on hand to complete the feasibility study.

The five deep holes were drilled at Boseto’s Zeta project, two holes of which were drilled within the existing resource envelope which is thought to be high grade. The other three holes were drilled between 600 and 650m below surface. All holes intersected mineralisation and assays are pending.

The Zeta mineral resource was updated in October to 35.4 Mt (million tonnes) grading 1.4% copper and 22.3 g/t (grammes per tonne) silver at a cut-off grade of 0.6% copper consisting of measured resources of 3.9 Mt at 1.6% copper and 23.0 g/t silver, indicated resources of 7.0 Mt at 1.5% copper and 23.8 g/t silver and inferred resources of 24.5 Mt at1.4% copper and 21.8 g/t silver. http://www.proactiveinvestors.co.uk/companies/news/12788/fd-capital-reiterates-buy-for-discovery-metals-maintains-72p-target--12788.html