UBS said the company’s exposure to the coking coal market put it in good stead but the company’s position as a price taker rather than maker meant analysts marked Excel with a neutral investment rating.

UBS were impressed with the miner’s diversified portfolio of three mines with varied extraction methods. “In the coal sector, Excel is our preferred exposure due to greater leverage to coking coal,” UBS analysts said.

Since Excel listed in April 2004 its share price has climbed to four times its initial value – a price UBS analysts believed was fully priced.

“Over the next six months we see the downside risks being potential project delays, and a pull back in coal prices from recent highs. However, the stock should be underpinned over the longer term by expectations of strong coking coal prices for longer, and further growth initiatives,” analysts said.

UBS also highlighted Excel’s growth profile, with production expected to double over the next two years.

Additional production will be sourced from the Wambo opencut expansion, the Millenium mine, which is expected to ramp-up later this year, and the Wilpinjong project, which will begin production in 2007. Additional production will also be added in 2009 with the ramp-up of the Wambo underground.