Yes I think it would be a crucial piece of the financing puzzle when it come to SDV funding.
I have always made the assumption of prepayments in my SDV models, now i'm factoring the offtake partner taking a 20% equity stake in SDV. Mr Rule said debt would not be needed if this deal eventuates so just updated my model as such
Column 1
Column 2
0
Calendar Year
2022
1
SDV
2
LCE production tonnes
25,000
3
Price per tonne (USD)
12,000
4
Operating Cost per tonne + royalties (USD)
4,140
5
EBITDA (USD)
196,500,000
6
AUDUSD
0.8
7
EBITDA (AUD)
245,625,000
8
Attributable to GXY (80%)
196,500,000
9
Interest (A$100m debt) @ 10%
-
10
Depreciation
1,740,000
11
Taxes @ 30%
58,428,000
12
NPAT (AUD)
136,332,000
13
EPS of SDV (400m shares)
0.341
So apply your fair value PE whether it'd be 12 or 15 then you get a range of A$4.09 to 5.10 for SDV valuation alone by 2022
GXY Price at posting:
$2.00 Sentiment: Buy Disclosure: Held