NWR shares continue to climb higher after yesterday´s 14% jump

NWR climbed the most in more than three years yesterday after Poland’s JSW (72 PLN, 7,54%) SA said the OKK coking unit put up for sale by the Czech coal company “may be interesting.” The stock jumped 14%, its steepest advance since April 2010, to 19.60 CZK by the end of trading Prague, with share turnover at 1.4 times the three-month average. Today the share continue in the up trend, actually 0,5 % higher. Local press wrote Petr Otava of Metalimex is also interested in OKK. / Based on the few recent comparison, a valuation range for the NWR’s coking business (OKK) may be 70-175 mln. EUR. The lower range is based on earnings potential as it is 5-6x EBITDA of OKK on normalized basis. The upper range is based on EUR/tonne of annual capacity with respect to JSW purchase of two coking facilities from the Polish state Treasury in 2011. We expect the offer price to be close to the lower range (70 mln. EUR) which may help NWR with its „quarterly cash-deficit“ in 1 or max. in 2 quarters in the current coal price environment in our view.