In line with Morgan Stanley's upwardly revised mineral sands price forecast, the broker increases the price target on Iluka Resources to $8.20 from $6.00.
While Morgan Stanley thinks the strength in the mineral sands market is well understood, the broker believes Iluka 's ability to supply volumes is a key risk.
Given the company's limited ability to deliver on volumes, especially rutile, Morgan Stanley's Equal-weight rating is maintained.
Industry view: Attractive.
Target price is $8.20.Current Price is $9.75. Difference: ($1.55) - (brackets indicate current price is over target). If ILU meets the Morgan Stanley target it will return approximately -19% (excluding dividends, fees and charges - negative figures indicate an expected loss).
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