Double whammy?
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Last week when I had posted and written I am not holding, prime reason I mentioned was that after a spectacular rise, and now struggling to really go up, I will wait for the results and then decide what to do. Someone wrote that my post is about nothing. And that post became popular. I hope some better understand what I was writing then - results will do the talking. And results didn't come last week, when it was due.
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On 20th May we got results of 4th hole. It was mentioned that 5th hole result will be end of May. We were talking only 1 week or so. But the results did not come by end of May. That was a big red flag. In my experience, if the results are delayed, within such a short period, in more than 90% of cases is because it may not be good. There can be genuine reasons for delay, but majority of time - good news comes fast, bad news finds itself pushed in a corner. The second red flag, even this week, they waited till Friday, before long weekend to get this out. I am not sure results are very bad etc, as I am not an expert in the field, but it didn't look good on surface, especially the grade, which has been decreasing since Hole 1.
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Overall, I still don't know how all the results add up. I will wait to read posts from some who are much better than me in interpreting it.
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Personally, when it dropped big, I thought of playing for a bounce, not big. I had my first exit around 3.8 mark. I had my second entry around 3.8 mark starting, but average was early 4. So I was waiting at 3.9 thinking a 3.8 hit may happen again. It came to 4.1 and then slowly reversed from there. Small reversal. Then I was in two minds. Either I wait for 3.8 play or take a small play if it settles. I took a small play at 4.4. To be honest, I was swayed by the directors buying, otherwise I would have waited. But a small play, around 10% of what I played last 2 times. I am sure many others may have seen directors buying as a positive signal, and maybe fell for it, if it goes lower. We don't know that. Yet. Tuesday may tell the story. After seeing Tony go, I felt I shouldn't have bought, but its done, I will have to deal with it. Who knows, it might still be all right.
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But the biggest news for me was Mr Tony resigning. I had felt Mr Datt had done all this work of buying big, huge buys even at close to 9c, was that he wanted to control the direction of KNB. He asked for a split to get rid of some directors. Then it looks like a compromise was made and Datt got Tony in. He spent several millions orchestrating this play. And for several months by building a position. Someone has kindly posted all his transactions. And its big. I came in first at 3. And he was buying big. Bought on placement at 3, then GUE 35m, etc. He looked like a man on mission. Someone who has seen the end, and the end is so beautiful, that I will do anything for it. So the question is what happened? Why did Tony resign?
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Its very difficult to say why he may have resigned. But any abrupt resignation, especially after not such a great announcement, there will be question marks. I don't know. But I am sure we will hear more in coming weeks. It may all be good and maybe there is change of strategy for Datt, but on surface doesn't look great.
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When it was going high towards 10c, one of the things I was writing regularly was that the big rise may be happening because of the big buys of Datt. I had asked the question - what happens if Datt stops buying, at that time reaching limit around 20%. I was very much wary about it, including the uncertainity. Hence I had written I exited when he was reaching that 20% level. And it sure did impact SP. If someone is mopping up all available shares at whatever the price, surely SP will go up. It will override all other factors. And when buying stops, unless there is great results to support the price, the price was bound to fall. So it came down from 9s to 6s. But it was still great, the SP, few months back when I started played, it was 3s. If you go back few months more, it was 1s. So 6s was still very good. I then thought that buying pressure is gone, results will do the talking. Someone didn't like it and tried to get some brownie points. By default, the sentiment of holders is to support holders. Its not about who is writing logical, correct, etc. By default. And if that holder is saying something against a non-holder, that sentiment increases like anything. I post a lot across stocks, many times I get that. I have no problem with that. People do realise over a period of time that sometimes my nothing may be something.
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So what will happen on Tuesday? Very fluid. Very unceratin. I don't have a clue. If Tony had not resigned, and because directors had bought, my feeling was that it may still drop but may come back from high 3s. Now after Tony resigning, I am not sure. What is Datt plan? He want's to exit? It won't be easy. He single handedly took the SP from 3 to 9. Based on available data, I don't think he has a reason to exit, yet. He may want someone else on the board? Not sure. But he is a factor. My gut feel is, that his next move will decide which way KNB will go. Besides hole 6 results. At least in short/medium term. For most of us, we try to understand and follow that path. As of now I don't have a clue. But we will know. Next week maybe, who knows Tuesday. This was a good story developing over here, it would be a travesty if it dies in this manner. I personally don't think its that bad, unless there is news we are not aware of - like indicative 6th hole results. But surely the drama which started a few months back, looks like has many more chapters left. For all holders, I wish, the outcome is positive. Even now I am at least 50% positive. So lets see. All the best.
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