Shares in specialist hard coking coal miner Pike River Coal continued to rise yesterday, after a "please explain" notice from the New Zealand Stock Exchange following an almost 15% gain.
Australian prices for hard coking coal, a key ingredient in the steel-making process, have risen markedly and several multibillion-dollar bids for Australian company Macarthur Coal were also fueling interest in coking coal, Craigs Investment Partner Paul Valk said.
The stock exchange asked why Pike River's shares rose 14.74%, or 14c to $1.09 on Wednesday, but Pike managing director Gordon Ward replied there was no material information to be released which could explain the rise.
Following two and a-half years' development of its West Coast mine in the rugged Paparoa Ranges near Greymouth, costing $280 million, Pike exported its first coal in March as it looks to produce 1 million tonnes of coal per year.
Pike shares were trading up a further 4.5% yesterday at $1.14, having steadily settled from a year-high $1.23 last June to trade at 88c at the beginning of March.
Mr Valk said there was a "small element" of profit-taking involved as shareholders realised the share spike offered an "opportunistic price". Craig's target price was $1.10 for the stock and there was no new information to prompt a review at this stage, Mr Valk said.
