Gemfields (LON:GEM) has "substantial" growth potential across its assets, reckons Investec, which has lifted its rating to 'buy' from 'hold'.
The business continues to evolve, highlighted by the interim figures, which reflected the integration of the Faberge business as well as progressing the mining asset base, which consists of the operating Kagem mine, the Montepuez ruby mine and other assets, said analyst Marc Elliott.
Last week, the AIM-quoted company announced a 137% jump in revenue for the six months to end December - going to US$65.7mln from US$27.7mln, while in December 2013, Kagem paid its first ever dividend of US$8mln.
Profit after tax was US$1.4 mln compared to US$4.7mln in 2012.
Elliott noted that bulk sampling was ramping up at Montepuez with 5.1 mln carats of ruby and corundum recovered costing US$4.8mln, taking total recovered carats to 7 mln.
Investec has lifted its target price to 39.6p compared to 36p previously.
The shares are now up 0.35% to stand at 35.75p.