Thank you TenX, I greatly appreciate your persistenceas always. I took in RNU in 2022 so watching the SP has not been easy, yet I decideto hold my balls and focus back on the fundamentals.
It is the entire battery minerals sector performingpoorly. The easy after the fact explanation given by major analysts is due to excessivesupply over demand – temporarily. Although I do believe the term temporary –which can be 2, 3, 5 years, or 3 months, I never trust their indicative timelineprojections. When lithium podumene peaked at over $8,000 per ton in December2022, had anyone dare to predict in less than 2 years time it would hit $800 aswe speak?
Again, we shall go back to the basics,
1. Are EVs still needed?
2. Are EV sales are still growing –though slower than expected?
3. Are nations completely scrapingtheir zero emissions goals, or simply accepting delays by adjusting andaccommodating to the real world challenges?
4. EVs may never 100% replace ICEs,but even at 50% market share, what would be the demand level for genericbattery materials?
5. Now the BIG question: can NaturalGraphite still play a role ?
To me the true risk to RNU is stillsynthetic graphite. Here is the harsh truth, by ignoring the cost factor,synthetic graphite is undeniable a superior product.
Question 1: how much more superior? Can naturalclose the **?
Queston 2: how much more costly to producesynthetic?
From research, it suggests that by purifying,coating plus other advanced processes, natural graphite can matchto synthetic’s performance.
“Match” – you wouldn’t call 70% as a match;80-90%? Very likely.
How about cost? Key note here – both syntheticand natural require a thermal purification process. In general, synthetic costs2-3 times than highly processed natural. This does not consider theenvironmental damage from producing synthetic.
Here is an interesting report, althoughdated in September 2022, I suspect there has been any technology milestoneprogress in terms of purification
please turn to page 7, bottom section –quote “However, thermal purification of graphite is less energy intensivethan the production of synthetic graphite whereby the material is heated(>2500 °C) for over a month”.
The point is, say if it costs $4000 to producesynthetic v $2000 natural, where it can match to 80% of synthetic performance, Ithink we have shot here. Synthetic can be applied to Ferraris, while Naturalfor mass production Toyotas.
RNU just needs to deliver, when the tidestarts to turn.
PS, there are so many smart folks here caneasily calculate an NPV for $100m cash savings in a 4% return commercial bank over10 years.
AMP delivers 16% return on my super. What NPVdoes that give me for holding $100m?
Fxck the shorters.
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