A new report from Macquarie has identified ASX mining stock St George Mining Ltd (ASX: SGQ) as one with plenty of upside.
It is a mining exploration company. Its main focus is its Mt Alexander Project in Western Australia and The Araxá Project in Minas Gerais, Brazil.
The company has evolved from a traditional nickel and copper explorer into a diversified critical mineral focused company post the acquisition of 100% of the Araxá Project in February 2025.
This transaction has allowed the company to strategically repositioned itself to capture value from the global energy transition.
Macquarie's report came after a visit to the Araxá project in Brazil.
Here's what the broker had to say.
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Resource upside
In Macquarie's report, the broker said the visit to the Araxá project in Brazil highlighted recent drill success, further resource potential, and the advantages of a good location.
Macquarie believes Araxá is well-situated in an area endowed with existing infra and local mining /processing capabilities. It could become the next key niobium producer.
It highlighted that the company has reported multiple drilling updates with assay results highlighting thick niobium and rare earths interceptions from surface as part of its current 10,000-meter drilling program (due for completion in 1HCY26).
Mineralisation remains open in all directions/at depth, with current drilling coverage representing less than 10% of the tenement area, presenting "significant upside potential for resource expansion.
Macquarie also said the drilling program could be extended.
Furthermore, Niobium processing is already well proven in the region, with CBMM (Brazilian mining company and the world's largest producer of niobium) having produced niobium for around 50 years using standard techniques such as wet grinding, magnetic separation and flotation.
The company has also recruited team members with experience in rare earths and niobium processing. Macquarie believes this should further reduce development risk.
Pilot plant update
In the report, Macquarie also highlighted that in October, the company announced a partnership with CEFET.
CEFET is a government-funded technology institute.
The two have plans to build a large-scale pilot plant.
This pilot-first strategy should allow this ASX mining stock to apply for environmental and operating approvals on a smaller, lower-impact facility, potentially speeding up approvals and providing more flexibility when selecting an eventual mine site.
The smaller footprint may enable a fast-tracked application process/flexibility for early stage mine site selection.
Price target upside
Based on this guidance, Macquarie has an outperform rating on this ASX mining stock.
It also has a price target of $0.20.
This indicates an upside of approximately 122% from yesterday's closing price of $0.09.
