When I posted on IRR it was to show that the project is a goer. There is no doubt in my mind the project will proceed, that was the point. The IRR outcome is significantly significantly greater than the hurdle rate used through the 8% discount rate used (and would still be much higher even if discount rates were 10% - 15%, albeit NPV would be impacted)
The key I was alluding to was post tax NPV and IRR, as the data in the SS is pre tax. I suspect NPV, refer my post above, on a post tax basis would not be lower than $300 million and at a high level your post tax IRR would also be no lower than 122% IMO, a remarkable result here IMO.
So if comparing Market Cap to NPV, the reason I didn't go into it in my own post was MC here is less than $100 million (even at the time of posting) whilst NPV (8%) is minimum $300 million post tax based on the SS with upside (assuming expansions and movements into HPA in future, obviously assuming those moves are viable).
IMO using NPV at this stage, instead of production, is simply a tool around indicating how viable a project is. How it translates to SP in the now (i.e. as the SS is trying to do) IMO is based not only on NPV but timeline to production. It is why in my post I stated - emphasis on slow in terms of SP don't expect a rocketing SP:
"Obviously in the short term (given production is slated for 2021) and these days investors wanting rocketing SP in the now the impact on SP is likely to be a slow upward trajectory IMO for the next 6 months or so with some peaks and troughs as the LOIs for example get converted to binding Offtake Agreements (with or without and equity injection)."
But I agree, in part, that where your NPV is 3 to 4 times market cap at this stage of the cycle (i.e. with still 18 months to production) I wouldn't be expecting a rocketing SP (however obviously conversions of LOIs to binding agreements will positively effect SP and obviously the closer to production ADN is the more positive impact on SP these types of figures would have IMO). In other words on a TA basis my view is the SP will trend up but there will be peaks and troughs, and obviously those who trade on TA will probably flood this board whilst those who are longer term and deal in FA will just watch on mainly IMO LOL.
But, when this gets to production it becomes about EPS and P/E (i.e are the yearly profit outcomes good) and generally when in production you use a P:E ratio of 5:1 to 10:1 (with yearly results, in an investment sense for investors in their own heads, and how they translate to SP been based on nominal data in the year profit result arises - i.e. demonstrated by how investors react in the market when profit outcomes are either higher or below expectations in that year).
(20min delay)