DML 0.00% 1.9¢ discovery metals limited

anyone thinks 90c is entry point ?, page-10

  1. 101 Posts.
    I think 90c is a good entry point.

    I've been invested since February this year and am taking the 18 month to 2 year view.

    Macro factors - growing copper demand, limited new mines being developed, the India/China/Brazil development story, the fear of too much money printing by central banks leads to an increase in commodity prices.

    Factors specific to DML. I am using EQN as a guide. EQN aiming on producing 140,000 tonnes of copper concentrate per year from grades of between 0.8% and 1%. EQN currently has a $4.1 billion dollar market cap.

    DML aiming to produce 36,000 tonnes of concentrate per year from grades around 1.4%. (So about 1/4 the EQN production). DML current market cap of $330m

    Without getting into too much detailed maths I believe there is reasonable evidence to value DML at around a 1/4 of EQN's value once it gets closer to production. 1/4 of $4.1b is around $1b - about 3 times the current value without including the upcoming capital raising.

    Have a look at the EQN chart over the past 5 years to see what may happen to DML

    The other key factor at DML - management has done what they have said they were going to do and on time.The construction of the mine will be interesting though...

    The piece of the puzzle that could spark a much greater increase in value is the potential for some big resource upgrades in the next 3-6 months.

    I wonder if DML management has considered building a power station big enough to produce power to sell to Hana Mining???

    From a technical viewpoint - anyone who purchased shares during the recent spike at $1.20 - 1.35 was asking for trouble.

    How often is a 50% increase in share price followed by a retrace - pretty often in my experience.

    I am happy to pick up a few more shares if the price gets below $1.00.

    The overall trend of the last year is up and I believe this will continue with a few spikes and troughs along the way - as it usually does with a tightly held company.
 
watchlist Created with Sketch. Add DML (ASX) to my watchlist

Currently unlisted public company.

arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.