Ann: Vijay Group JV Update , page-3

1.5 million tonnes of iron ore per annum (in two years time).

Worst spot price in recent history = $86.

Worst possible cost of production and transport $70.

Vijay get 50% (ish) of profits.

$86
- $70
= $16 profit per tonne.


1.5 million tonnes produced (?).
x $16
= $15 million profit.


If I do the same calcs with a more realistic long term spot price of (say) $95 / tonne. Profit = $35.5 million.

Probably shouldn't publish my back of envelope calculations as I am not know for my mathematical ability.

35.5 million dollars divided by 352 million shares = about 10c / share. Is that right?

So a Price to earnings of 10 would place that at around $1 / share?


I'm just tossing this up for discussion. Don't make me get my flame retardant suit.