“I thought that it was being punished for delays and the recent cr.
I also thought the bear market for small resource stocks was over from around late last year. However after having a look over 5 year charts of a lot of stocks on my old watchlist, it is clear that the bear market really hasn't ended yet and that MNB, as bad as it's been recently, has still outperformed many other small caps.”
Chuk whilst I value the knowledge you give to this forum, I don’t think you can pull up the 5 year charts for a handful of small cap stocks and say thats representative of small caps, or is why we’re at 5.6 cents.
IMO Minbos’ SP is 5c instead of 10c because of the cap raise, that 10c would now be a lot higher if not for the delays. I’ve put the 5 year chart for the asx small ordinaries below. I could pull up 5 year charts of companies like PLS, LTR etc which would show massive gains over the 5 years. If a small cap stock is lower than it was 5 years earlier clearly it hasn’t achieved it’s business plan, those that have succeeded like PLS are no longer small caps. I’m not saying they haven’t had a bad run, however there are a lot of unsuccessful small caps that just flounder, whilst many flourish. Many do cap raise after cap raise with a little drilling in between, they keep the Directors and management in a job and that’s about all.
Now I don’t put Minbos in that category. For a small company to raise US$24m or A$36m with minimal dilution is not an easy task. They probably thought the Chinese syndicate would cover it with the $25m facility included in the MOU. Then the IDC loan took a year and still had further conditions attached. Clearly the finance caused the delays, but then the cap raise was a complete disaster. They were probably a victim of circumstance here, the original $10m with no option would have been ok, another opportunity presented itself and they probably did the right thing suspending the stock while they investigated that opportunity. Unfortunately (I assume) it didn’t work out.
Now the amount they need to raise is down to only US$10m, I have every confidence they will get this money and satisfy the CPs by end of July. They seem to be working a lot of options to achieve this. The overhang from the cap raise will eventually go away & in a years time we’ll probably have forgotten about it.
Long winded I know, just saying we’re at 5.6c because of the cap raise + delays. I think management has to regain the confidence of investors, start by being more realistic with time frames which hopefully they’ve now done with the new schedule.
