RBC Capital Market announced it has revised its rating upwards for Petra Diamonds.



“Petra's production and grade forecasts for two of its major diamond mines, Cullinan and Koffiefontein, came under scrutiny during the recent $120 million fund raising. When comparing Petra's targets with De Beers' budgets and actual figures we believe Petra's goals are achievable,” RBC Capital Markets said in a note to clients.



“Following the issue of shares to raise new capital, repay loans and buy 37% of the Cullinan diamond mine we have updated out model which results in a higher NAV of $650 million. The large increase in issued shares dilutes the impact at the per share level with our NAV rising 9% to £1.15/share.”



"Using the same 1xNAV ratio as for other diamond producers we are revising our target price upwards from £1.05/share to £1.15/share. With funding risks largely eliminated and Al Rajhi's interest converted into equity in Petra Diamonds itself, we are changing our risk modifier from Speculative Risk to Above Average Risk," RBC said