Hey Kalenn, Onika, Autosime, Aman2, niclou, restlessbird and all other avb'ers TU’s...thanks for the positive comments...
Onika...I agree with you could use WACC being an expected return on a portfolio of all AVB's securities...this hurdle rate of the cost of equity and the cost of debt meaning the weights would be determined by the relative proportions of equity and debt in AVB's capital structure...only problem is AVB has no debt...just capital allowance specifically for deferred expenditure for exploration OPEX and admin expense...The idea of using SFR's DFS and BFS 8% discount rate is feasible since AVB is at a similar stage to SFR’s development...remember also factoring Brazil's core inflation is 5.5% and range bound...also consider the consevative nature of the calculations for projected 500k of conc. over 10 years...when we know AVB's JORC will potentially go 1000k tonnes of payable CU equiv...meaning these numbers will increase...
Again the idea following the progressive de-risking of AVB's projects coupled with a certain growth in Global JORC resource numbers and critical exceptional proven met. recovery rates...Bethebest was querying the SP numbers floating around the AVB thread...So I thought let’s get a firm number on the table for in-situ [valuation for current stage of AVB development] and NPV for future DCF as AVB potentially approaches pre-production...However, this is based still on assumptions from still unknown parameters and hence still indeterminate...
Fatandlazy...good question regarding the final NPV number...in my haste to post...I neglected to nominate the $1.23 being in AU currency...all calculations were done in US$...and converted back to AU$ at average 1.037...again this is a moving feast...Just to get an idea of an approximate value for AVB post DFS...if the AU currency depreciated against the US$ so would the value of gross revenue streams and NPV measured in AU$...best regards all
AVB Price at posting:
12.0¢ Sentiment: LT Buy Disclosure: Held
