Shell Oil&Gas company that has become a ruby miner in Mozambique.
Embarking on maiden bi-annual ruby auction tomorrow.
Also has a reasonable quality graphite asset(undeveloped)
SP 15cents
Market Cap $109m
Cash $399k at end Jun-17
This stock has been on the top of the most discussed list of HC recently, so is probably on most peoples radars.
I've been in and out of the stock since Jan-17 and have done alot of research on the company/industry, but honestly have traded it poorly to date.
Pros:
One of only two publicly listed ruby miners in the world.
They have a unique valuable product/commodity in a growing market.
My own estimate of cash that will be raised at pending maiden ruby auction:
10% probability - $10-15m USD
50% probability - $50m+ USD
10% probability - $80m+ USD
If they can raise 50+m, the re-rate of SP will surprise everyone IMHO.
Cons:
A shell is a shell and the way they've raise capital in the last two years is typical of a shell. You know what they say about leopards...
They are operating in one of the poorest most undeveloped countries in the world.
The MD is very young and contrary to what the die-hard HC posters say, I believe he has yet to prove himself. I honestly believe he is trying to make a company though.
A private Mozambican company, Regis Resources, controls the board and owns 30-40% of the company(I think).
The structure of the share-in arrangement in the mining leases is unclear/confusing.(to me anyway)
In my opinion there are potential conflict of interest issues with the company buying assets from a private company the is part owned/controlled by the board.
