Almonty Industries Inc (ALM): Beneficiary of Tungsten Dislocation, but Expectations Seem Elevated; Initiate at Neutral

We are initiating research coverage of ALM at Neutral. ALM sits at the center of the Western tungsten investment narrative as policy actions taken by China have resulted in global supply concerns, causing the price of tungsten to increase 8x since the beginning of 2025. ALM owns one of the most important tungsten development asset outside China, the Sangdong mine in South Korea. However, we believe the stock is increasingly reflecting a continuation of today's exceptional tungsten market as well as an aggressive production profile for Sangdong. Our estimates diverge from consensus in two key areas: (1) we expect tungsten prices to normalize as new mine supply, recycling and refining capacity respond to current economics and (2) we expect Sangdong's ramp to progress more gradually than market expectations. While we remain constructive on the strategic value of ALM's asset base, we believe current valuation already discounts much of that upside potential. We estimate ALM could eventually