$7.50 broker npv target - trading at 17c..., page-42

Hi,
For starters consider that independant auditors for the sale of IGC's 15% stake in one of NKP's main 2 mines with approx 25 mill ounces has been valued at 60 mill which says to me that deposit is valued currently at close to 400 mill.
NKP's other deposit with approx 25 mill ounces aswell borders the same deposit with roughly the same % of Platinum at same depths which say to me that this deposit is valued at approx at 400 mill.
So in my books 800 mill is current value for the 2 deposits divide by 500 mill shares gives a current valuation of $1.60.
The $7.50 target is for 3 years time, not tomorrow, it all depends if all hurdles are crossed.
Why would Xstrata bother trying to get a 50% option for a company that at 40c would only be worth 200 mill, Xstrata wants the option because its insurance that if Platinum prices are at these levels or even higher in 3 years then these deposits will put NKP in the top 5 Platinum miners in the world.

If platinum is at $1600US and costs to extract ie opex is around $500-$700US means profits between 900-1100 per ounce.
NKP is tragetting production of 1-2 mill ounces per year for 50 years.

Expected earnings are in the order of 700 mill plus per annum.
Lets say the stock has 500 mill shares and is earning 700 mill per year or $1.40 a share per year then place the stock on whatever p/e you like.
A pe of 3 means a share price of $4.20..Pe of 5 means a share price of $7 and a p/e of 10 means a share price of $14 etc etc.
It mainly relies on platinum prices, its not just the platinum price as roughly another 10% on top of the platinum price should be added to earnings for other metals like platinum gold etc that will also be extracted.

Thats my understanding, happy to be told where i am worng