While hard to quantify without project valuation metrics, Morgan Stanley sees potential valuation upside for OZ Minerals after the signing of a term sheet to purchase the Kalkaroo project from Havilah Resources ((HAV)).

The analyst points to potential synergies with OZ Minerals' operations in South Australia, particularly at Prominent Hill.

The $17.20 target and Equal-weight maintained. Industry View: Attractive.

Sector: Materials.

Target price is $17.20.Current Price is $25.70. Difference: ($8.50) - (brackets indicate current price is over target). If OZL meets the Morgan Stanley target it will return approximately -49% (excluding dividends, fees and charges - negative figures indicate an expected loss).

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