Time to get CAUTIOUSLY bullish on where TON is going imho.
2c support remains and accumulation continues.
Nothing to the negative happening re TON corporate-wise or in Mozambique to my knowledge bar the continued force majure which some may say is enuf to keep them out of Mozambique. Thing is its not stopping Syrah investors and this company is virtual neighbours with TON. But there u go !!!
What else to get negative about ?
Well maybe:
1) Ancuabe finance for one.
2)Then theres whether or not Yulong mining is associated with Shandong Yulong, and even if so, will Yulong Mining relinquish Nicanda Hill to TON given Shandong Yulongs intentions with creating a stronger RENEWABLES associated commodity trading entity, IF Yulong mining is indeed controlled by Shandong Yulong.
3)Will Cobra Plains be able to be turned into an Ancuabe-like project via a new round of drilling.
4)Does Rod Zhang have TONs best interests at heart, at least in the short to medium term.
5) And the biggy for mine, will NH be reassociated with TON in terms of a mining concession
NAHHH not much risk around old TON atm
But Im going to model a relatively perfect scenario with a TON valuation/s
I put the plural here as there will probably be 3 main iterations of valuation, and then here is the sliding sp effect of the sector IF the graphite price resumes its rise into the potential graphite deficit from 2025.
So lets just say that force majure is cancelled and we do see a move to natural graphite deficit and the basket price of graphite continues its upward move.
Some might say this is enuf to raise the multiples factor for TONs sp.
Trouble is we r in Africa, the place most instos love to hate, or perhaps more likely, manipulate hard to make money on market as the sp moves around in its daily girations.
So we finalyy get the Ancuabe enviro approval which is quickly followed by a financing annmnt for the project.
Now taking into account the fact there r nearlly 1.5B shares on issue, I think its 1.35B undiluted and 1.5B diluted by options etc, then we may base our price per share on 1.5B. Makes for slightly easier maths, as well as being a touch on the conservative side for the share price.
So we have:
100M to finance Ancuabe, so we'll put the eventual capital value of Ancuabe at 100M.
Now in cents thats 100M X 100 cents per dollar of project value or:
$100,000,000 X 100 = 10,000,000,000 or 10B cents
And we have 1,500,000,000 shares on issue fully diluted.
That gives a value attributed to Acuabes financing value of 1
$100M at.
Ancuabe project value/ Shares on issue or
10,000,000,000/1,500,000,000 = 6.66 cents per share.
Now that jibes well with previous broker valuations when they were spruiking TON when things were going swimingly and it seemed Ancuabe was going to get its finance no probs. Then the poo hit the fan, and directors kept taking their so-called right to a directors remuneration even tho things were starting to look pretty stressed. If U had a very tightly run ship, as it appears TON is more aligned today,then maybe we wouldnt have seen Shandong get involved and the very promising Ancuabe with its offtake backed project wouldnt have had the Shandong dilutionary factor we have today.
BUT, thats not how it played out.
We now argueably have a much stronger corporate backing with Shandong on board, literally and figuratively as well as Adrian Costello, a previous Shandong employee at the gold mining entity.
We then had Rod Zhang, Adrian Costello ( TON/Shandong connection) off to Mozambique to check out the TON projetcs,
"Hosted Cornerstone Investor Shandong Yulong to Mozambique-Delegation visited Ancuabe Project, Balama North Project (Nicanda Hill, Nicanda West and Cobra Plains deposits), peer projects and infrastructure locations in Mozambique for due diligence and early engineering purposes."
"Delegation included representatives from a major Chinese mineral processing equipment supplier-also Visited Nipepe Graphite Project in Mozambique, broadly comparable to Ancuabe, which provided Yulong and company representatives confidence in the suppliers capability."
Now subsequent to this we have had a mining license anncd for Cobra Plains with the annmnt heavily implying that Cobra will get the go-ahead not long after Ancuabe. A smart move imho given they will b able to stage graphite output relative to graphite demand.
"Meanwhile, Triton on Wednesday said that discussions were still ongoing regarding the Nicanda Hill licence, which the government was now reserving for public tender, despite the company’s efforts to have the licence renewed.Triton has appealed to the Mozambique government and is making "every effort" to obtain a renewal of the licence, the company said.
Now dont forget Rod Zhang with his Chinese cash backing, I believe another poster mentioned that Shandong r financing associates r willing to stump up around $36M Ancuabe,not sure if this is US or Oz, have made the Chinese intentions fully known.
Low and behold we have Nicanda Hill, with a Yulong Mining name, now attached on the Mozambique Cadastre.
So going forward if we assign Cobra with the same project value as Ancuabe, that lifts the sp to 12 to 13c.
AND if we then get ultra positive and reallocate Nicanda Hill from Yulong Mining to TON ???
And we value Nicanda hill at roughly the value of Syrah resources ex Vidalia, given Nicanda Hill is comparable in size to SYRs Balama if not a little larger then accrding to this item we have SYR valued at a tad over $1B !!! and thats prior to Vidalia assigned value. That was also with 20% drop in the sp after Balama workers kicked up a storm over safety concerns. Around this time we had 2 TON employees killed by insurgents so its no wonder SYR's employees were not happy campers.
So IF we go ultra bullish and add another 1B of value to TON for Nicanda Hill we get an sp of:
Ancuabe + Cobra Plains + Nicanda Hill OR
$100M + 100M + $1B
OR $1.2B
A long way off perhaps, Im estimating late this decade. So by 2030 we will have TON at potentially:
$1.2B/2B shares on issue.
which gives 60 cps !!!
Noticed Ive upped the shares on issue to 2B in case we see furtther dilution on Cobra's capital raising as well as Nicanda needing an equity issue for financing.
THIS MAY NOT BE THE CASE if they get Chinese offtakes financing Nicanda and given the forecast deficit whos to say this may not happen.
So if we stay with 1.5B fully diluted we get
$1.5B/ 1.5B shares.
Now THATS easy maths
$1.00 per share.
CURRENT UPSIDE INTO THE VERY SCARY ZONE even if I do say so myself.
Even 50c would b incredible as its......well I simply cant put a multiple on it as its unbelieveable tstl.
Now as mentioned above this is ultra bullish BUT entirely feasible IF
1) Nicanda Hill does come back to Triton via Yulong Mining
2) Shandong Yulong DONT take out TON.
Two big factors in such a bullish assessment of the TON sp.
Now there is potential upside to this believe it or not.
And thats if the graphite sector becomes hot, which it may well do given the graphite deficit forecasts
"Management noted anode material inventory growth in China has recently slowed and the decision to pause production was to both enable downstream inventory consumption and allow for an improvement in natural graphite demand conditions."
'More positively, the graphite price received during April was US$688/t, up from US$636/t in the March quarter, and 16% ahead of Macquarie’s forecast. The sales mix was weighted towards higher-priced coarse-flake product, for which ex-China prices remained strong."
I believe very similar to TONs graphite, that is large pure flake.
The average target price of the three brokers falls to $1.15 from $1.43, suggesting around 47% upside to the latest share price !!!
That would put SYR at a market cap of around $770M with 670M shares on issue at an sp of $1.15
Interestingly currently well below my somewhat bullish TON assessment
BUT we r in a relatively depressed graphite market atm and SYR r having some issues as evidenced in that item above. Note that SYRs sp is only 45c atm due to the above.
Also note Maccas were spruiking SYRs sp much hiigher than cuurent.
Again I question big instos motives around these graphite plays atm and its primarily becos of what Ive posted above.
Now given this potential massive upside do we think theres a need for Shandong Yulong to take out TON given they hold over 30% of the company. Ill leave that to other posters mathematical skills to calculate what Shandongs 30% would b worth if the sp did get to $1.00 !!!
Now wouldnt u accumulate at 2c if THIS was the upside.
Even if it was only half this it would still be massive.
Now if others will crunch some numbers and play devils advocate please do as Im finding it difficult to accept such numbers, even at 20-30c it would still b massive.
No wonder theres bot and sp manipulation going on !!!
