Since March, the stock price has increased by more than 50%.

Hillview Metals Mining Co., Ltd. (SVM.US), which focuses on the development, operation, and investment of precious metal mines, has recently attracted the attention of many investors.

Hillview's recent announcement of the acquisition of Adventus Mining Corporation in Canada has once again attracted industry attention.

Many analysts have stated that Hillview's stock price is undervalued, and there is now a good opportunity to buy.

Mergers and acquisitions (M&A) operations create organic growth, and undervalued quality targets are on the market.

Regarding Hillview's stock price and this M&A event, Canadian analyst GoldStreetBets Research mentioned in his research report that Hillview (SVM.US) currently has a market value of $560 million, and according to the company's latest financial report data, the company has cash of $200 million and equity investments of $140 million, which calculates the company's enterprise value (EV) to be $220 million.

The analyst also stated that Hillview's net asset value (NAV) is conservatively estimated to be over $600 million, which means that Hillview's current enterprise value/NAV is only 0.36 times, indicating a phenomenon of being seriously undervalued.

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Interestingly, after calculations, it was found that according to this valuation method, as of May 9th, Hillview's market value was only $594 million, and the enterprise value/NAV was only 0.42, indicating that Hillview still has the possibility of being deeply undervalued.

So, how should we correctly understand Hillview's value?

And why is it considered the best time to buy now?

It is worth further exploring by combining the company's project development and operation capabilities, profitability, and the M&A project itself.

Hillview announced that it has reached an agreement with Adventus Mining Corporation in Canada to acquire all issued and outstanding common shares of Adventus in exchange for shares, and Hillview has obtained two large gold and silver mines, copper and gold mine projects in Ecuador, El Domo and Condor.

It was observed that before the announcement was released, Hillview's stock price had risen by nearly 50% since March, but after the announcement was released, the stock price experienced a certain rebound.

According to the international market law, the stock price rebound is expected.

However, although the decline in stock prices in the short term may cause market concerns, by carefully observing this transaction project, it will be found that there are multiple benefits behind the project, which will become a driving force for Hillview's long-term growth, and this also provides a great entry opportunity for investors who can identify and believe in the company's long-term value.

In my view, through this transaction, Hillview can add low-risk, low-cost copper, silver, and gold mine projects that have obtained key permits, greatly increasing Hillview's mineral resources and reserves, and is expected to increase production by more than 50% by 2026, while also benefiting Hillview's multi-country layout and metal diversification.

This M&A may ultimately become a catalyst for the re-adjustment of stock ratings.

Specifically: Firstly, this M&A can further consolidate the company's mineral reserve foundation and further lift the imagination space for the company's future growth.

The El Domo project is one of the world's high-grade copper and gold projects.

According to the feasibility study report released by Adventus, El Domo will produce an average of about 21,000 tons of copper equivalent per year during the 10-year mine life, with a total cost of $1.26/pound of copper equivalent, which is very competitive in the current market, especially when the current trading price of copper is $4.50/pound, and the demand for copper will continue to rise in the next few years.

Currently, the project can be put into production as soon as possible.

Multiple data indicators show that the project has a strong profit potential, can generate good economic benefits, and help Hillview achieve metal diversification, especially copper.

In this M&A, another project, the Condor project, disclosed in the 2021 pre-feasibility study report, is expected to have a mine life of 12 years, with an average annual output of 6 tons of gold and 24 tons of silver.

It is not a large project, but it is a high-grade gold and silver mine project, and the future exploration potential will be further improved.

The integration of this project will greatly increase Hillview's overall resource volume and lay a solid foundation for internationalization and metal diversification.

Secondly, policy benefits and widespread community support for the mining industry will also provide strong support for the production and operation of future projects.

Public information shows that the Free Trade Agreement between the Government of the People's Republic of China and the Government of the Republic of Ecuador came into effect on May 1, 2024.

Both China and Ecuador have gradually eliminated tariffs on about 90% of tax items, enhancing the level of trade and investment liberalization and facilitation between the two countries, and promoting all-round quality and upgrading of bilateral economic and trade cooperation.

The policy benefits at the national level undoubtedly provide a strong boost to Hillview's regional diversification strategy.

It is reported that Adventus has previously reached a preliminary commitment with the Ecuadorian government on the investment protection agreement for the El Domo copper and gold mine project.

The Ecuadorian government will guarantee the company's ownership and investment security and further reduce the tax burden of income tax and capital outflow tax.

This agreement deepens the protection of Hillview's infrastructure construction and subsequent mining operations of the project, strengthening the company's profitability.

In addition, the Condor project is 55km away from the Mirador copper mine, which is the first large-scale solid mine development project in Ecuador, and is a copper mine invested, designed, constructed, and operated by China, with a copper ore processing capacity of 20 million tons/year, producing about 90,000 tons of copper metal equivalent copper concentrate per year.

During years of mining development, it has also been continuously benefiting the local community and has won widespread support from the local community for the mining industry, which will be beneficial to the construction and operation of the Condor project.

In addition, with Hillview's rich experience and strong professional technology in mine development, it is expected to further optimize costs and increase profit margins.

Currently, Hillview has successfully operated mines in China for nearly 20 years with professional technical advantages, built 8 mines, and has a very mature mine operation and management capability, with excellent financial performance for many years, with operating cash flow of nearly $90 million in the past year.

Hillview is also committed to ESG and practicing corporate social responsibility.

From this perspective, Hillview's expansion move not only indirectly confirms Hillview's precise grasp of industry trends and forward-looking thinking about its own development.

More importantly, this transaction can help Hillview complete its industrial chain extension at a lower cost.

In the past six months, the prices of gold and silver have been breaking new highs, and the market has generally reached a consensus that gold prices may maintain a long-term upward trend.

This means that under the condition of stable futures and spot prices of gold and silver, and a clear upward trend in the medium and long term, companies with sufficient mineral resources and reserves, such as Hillview, will usher in new development opportunities.

More importantly, Hillview has been focusing on exploration, incubation, and M&A operations in the development of overseas mineral resources for more than 20 years, continuously integrating resources, and has formed a strong comprehensive competitiveness in aspects of capital, management, technology, mechanism, and experience.

By continuously strengthening the company's development moat with high-quality technology in diversified layout, Hillview can not only provide sufficient funds for the construction and exploration of more projects but also continuously empower the development and operation of more projects with its leading technology.

It can be seen that with the continuous enhancement of Hillview's global resource integration and allocation capabilities, the company will open up a new development situation.

With the rising trend of gold and silver prices in the future, the company's performance imagination space is continuously opened up, and the stock price is expected to gradually reflect its true intrinsic value, providing investors with an attractive entry point.