Concur with the sentiment.Much of the price action here has been...

Concur with the sentiment.

Much of the price action here has been driven by the in-specie distribution of shares to WGX shareholders. Of the 200m shares on the CST register 100m were given to Westgold shareholders. 100m shares were issued at 20c a share, giving a cash balance of roughly $20m before listing costs.

A few things to note.

1. Westgold has a rather large institutional shareholder base who have received shares in CST for in essence free. On the day WGX went ex entitlement the share price actually increased which tells you basically that CST is an ant compared to WGX ($1bn market cap). 18 of WGXs top 20 shareholder are institutions, with the other 2 being Peter cook (Chairman of WGX and CST) and his entity Avaja holdings pty ltd. All of these institutions have received an inspecie distribution of CST shares. I would say that for a fair proportion of them the investment thesis would be to invest in a profitable gold miner with a market cap of circa $1bn (WGX). A junior explorer with a market cap of sub $40m would not be their cup of tea and given that they were given essentially free shares they have sold/are selling them in a pretty carefree manner. You will have noticed periodic market sell orders for obscene amounts. Today in the space of 1 minute there were 2 orders of 500 000 and 1 000 000 units. This has happened quite a few times, yesterday and on the 14th May for example. Since listing roughly 90m shares have traded. I would expect that the selling from WGX shareholders is likely almost done given we know that a few of those institutions have been supportive and subscribed for more shares.

2. Peter Cook (WGX and CST Chairman) has a shareholding of approximately 10.4m shares. He received roughly 2.3m shares as part of the inspecie distribution. He has bought roughly 8m shares in the 20c offering. This is $1.6m dollars worth. He in fact was willing to buy up to $5m worth of shortfall see below from prospectus

So in terms of skin in the game the chairman of castille, who is also chairman of $1bn WGX has plenty of skin in the game. Westgold are underground gold mining specialists with 7 underground gold mines.

3. Other notable Shareholders include Paradice Investment Management 10m shares (all paid for at 20c a share), Kingdon Capital
NY Based Hedge fund.

At the moment the transition of shares from in-specie distribution recipients to those with a genuine interest in Castile is playing out, each day of trading bringing the end of that transition closer.


If i were to say to you that tomorrow a company would report the following drill intercepts, what would you say their EV would be?

10m @ 47.97 g/t Au
7m @ 125.93 g/t Au
20m @ 32.61 g/t Au
23m @ 13.22 g/t Au
22m @ 21.89 g/t Au
12m @ 58.4 g/t Au

21m @ 6.86% Cu
27m @ 4.75% Cu
27m @ 3.26% cu
30m @ 4.46% Cu
42m @ 4.10% Cu
29m @ 3.6% Cu

EV at the moment is circa $7m which is ridiculous when compared to some of the EVs floating around based on just sampling and mag surveys.