It may be taking time, but the puzzle is slowly coming together. NPV mine (all in US$) $197, NPV Battery Manufacturing Facility $115, total = ~$312m, current ~$33m (AUD). What an interesting 2 years we have ahead of us.
I also like the projected trade routes between Tanzania and Europe (EGT & ThyssenKrupp), US, South Korea and Japan. What delightful announcements are pending? I wait with baited breath!
What this report doesn’t say is no one outside of China is producing spherical graphite (or graphite for that matter) in any meaningful quantities and given the rest of the aspiring graphite market is being tied-up by China, I believe KNL is making meaningful steps to differentiate itself and will soon be attracting a premium, if not a Chinese takeover offer. China only hates monopolies when it isn’t in control. I guarantee you the graphite related companies in China will be taking notice of KNL, we already know they offered one dragon-offtake, which management was wise to decline. This is a company, not speculation after all.
The spherical graphite proposal won’t just attract attention from the world’s producers, but universities and technology researchers too. Everyone knows China has a heinous record with enforcing intellectual property patients, worse still are its theft record. Just like the CSIRO and 3D printing, companies will be knocking on KNL’s door in increasing numbers giving us a piece of yet-to-be-developed technologies. This is an amazing wow factor for KNL, potentially worth more than the entity itself as the years and KNL carries on its business as usual, no fuss approach.
Where can the share price go with all of this coming to fruition? I really don’t know, but I think the run to $2 will be just the beginning!
KNL Price at posting:
19.0¢ Sentiment: Buy Disclosure: Held
