What is the expected timeline for the royalty stream to become a material contributor to the company's recurring revenue?

Answer – Expected timeline

Dundee’s press release makes clear that the royalty from the Borborema Gold Project has only just been turned on in the current quarter and that the company is still in the “early‑days” phase of the stream. Management therefore signals that the royalty will not be material to recurring revenue immediately, but will need time for the mine’s production to scale. Industry‑typical ramp‑up curves for a new gold operation suggest that a royalty stream usually reaches a material‑contribution level (i.e., ≥ 10‑15 % of total recurring revenue) within 12‑18 months after first receipt, and it could be fully entrenched by the 24‑month mark as the mine moves from initial output to steady‑state production.

Trading implications

• Short‑term catalyst: The inaugural royalty receipt is a positive catalyst that can trigger a modest price‑up move now, especially on the “cash‑generative” narrative. Expect modest upside on the next few sessions if the market digests the news without a broader macro pull‑back.
• Medium‑term positioning: Because the royalty will only become a material contributor over the next 12‑18 months, the stock’s upside is tied to the successful ramp‑up of Borborema’s gold output. Investors who are comfortable with a 12‑month horizon can consider a long‑biased stance (e.g., buying on any pull‑back now and holding through the ramp‑up) while keeping a watch‑list for any production‑delay news.
• Risk management: The key risk is a slower‑than‑expected production ramp or a decline in gold prices, which would postpone the royalty’s materialisation. A stop‑loss set around 8‑10 % below the entry level would protect against a scenario where the royalty stream stalls and the broader market turns bearish.