General Discussions, page-30027

Thanks for following up - my post may not have been clear if that was your take.

I don't have those concerns.

I'm trying to understand why there is such mixed/negative sentiment by holders (including yourself listed as Hold for example, but more importantly the mixed and negative commentary from a numbers of posters) in contrast to most holders having a Buy sentiment on comparable investments at comparable stages, not to mention all of the recent good news.

My take, and it goes without saying DYOR, is this is severely undervalued:

• NPV10 of A$1.5bn in the DFS with circa A$363m annual EBITDA across the 40 year LOM
• Graphite is critical for two major growth areas that are likely to keep growing substantially in the near to mid term (renewables, defence)
• Moves by China to restrict global supply of Graphite outside China limit supply to non-China manufacturers
• Simultaneously, moves by US to "disconnect" from China markets will both raise demand and therefore prices for non-China resources, and will likely foster greater manufacturing in US/US-aligned nations, further increasing demand
• Emerging role of AUKUS and push for sovereign self-sufficiency + growing global destabilisation likely to fuel this further
• Clear focus for both SA and Federal Governments
• Seemingly strong indications that remaining approvals will be straightforward
• Favourable $185m loan facility from Federal Gov
• Potential for further loans and/or grant funding from Gov
• Between cash and loan facility, more than funded for Mine and Mineral Processing Plant
• $114m cash on hand
• All of the above for a $300m market cap.

Those concerns I'd listed that might be on the minds of those with mixed sentiment are the highest risks I can identify, and for each of them my take is:

• Graphite prices are highly manipulated, they're already showing recovery and in any case the real test will be landing a solid offtake agreement
• The US/China mineral competition is favourable to RNU for the reasons outlined
• Synthetic graphite requires three times the energy of natural graphite. Energy demand and prices keeps increasing, so short of Nuclear Fusion natural graphite competitiveness should continue (with that said, I'd support a plan down the track of RNU exploring synthetic production leveraging excess daytime renewable energy in SA)
• No reason to doubt the capital costs
• Always nervous about CRs, but that's the nature of the game. Potential for further debt funding, and hopefully there's other upside to offset any dilution.