BHP Group Ltd (ASX: BHP) shares have been very strong performers over the past 12 months.
While this is great for shareholders, other investors are now having to pay a premium to buy its shares.
The good news is that according to Bell Potter there is an alternative ASX mining stock to consider buying for exposure to the resources sector.
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Which ASX mining stock?
The stock that Bell Potter is bullish on is Develop Global Ltd (ASX: DVP).
The broker highlights that it operates a unique hybrid business model centred on the decarbonisation and energy transition thematic.
This includes high-grade base metal assets such as the Woodlawn Zinc-Copper Mine and the Sulphur Springs and Pioneer Dome DSO Projects. It also has a cash-generative Mining Services division that provides underground development and production for third-party operators.
Bell Potter notes that the ASX mining stock has just given the green light to Sulphur Springs and Pioneer Dome. It was pleased with the news and believes they leave it well-positioned for the future.
Commenting on the final investment decisions, the broker said:
DVP has taken Final Investment Decisions (FIDs) for its Sulphur Springs and Pioneer Dome mining developments, with the latter staged (Stage 1: open-pit mining of 850kt DSO over 1 year). DVP expects to deliver first production at Sulphur Springs by the June 2028 quarter and Pioneer Dome by the December 2026 quarter.
Concurrently, DVP has refinanced its $105m debt facility with Trafigura, entering into an upsized ~$500m senior secured debt facility with Trafigura that will address the financing needs of Sulphur Springs and Pioneer Dome. The terms of the upsized facility are favourable; an 18-month grace period on repayments was secured (including the original Woodlawn debt drawdown in December 2024).
Big potential returns
According to the note, the broker has responded to the news by retaining its buy rating and $7.10 price target on the ASX mining stock.
Based on its current share price of $6.10, this implies potential upside of 16% for investors over the next 12 months.
Commenting on its buy recommendation, Bell Potter said:
DVP's ability to rapidly bring Pioneer Dome to market presents an opportunity to capitalise on current robust lithium prices, with strong resulting free cash flows to support its balance sheet at a time of heightened capital spend at Sulphur Springs.
EPS changes: Incorporates the Pioneer Dome DSO production scenario outlined in the FID outcome, updated Sulphur Springs economics and non-operational adjustments: nc in FY26; +54% in FY27; and +1% in FY28.
