Its always nice to come across a Company that is simply in the...

Its always nice to come across a Company that is simply in the position of making money and would appear to be fundamentally immune to the contagions that have affected their competitors and others within the broader market.

What makes this a more interesting proposition is the potential impact an official risk re-rating could have on the perceived value of the stock. The underlying investment strategies of most major institutions and investment funds still remain conservative and defensive. However, should a Company produce a convincing operating report which proves the ongoing and sustainable mechanics of revenue and profit generation, then the investment dollars will flow.

Such is the current status, I believe, with ‘PLA’. It’s a simple matter of ‘Could do ‘v’ Really doing it’.

A few facts and permutations
• 260 million shares diluted
• Smokey Hills forecast annual capacity 95,000oz 4E PGM
• PLA retain 85% of cash flow over the life of the project
• Self sustaining power plant generation
• $US300 per oz profit margin at $US950oz 4E PGM = $US28.5m or $A39.9m Profit Before Tax annually
• $US500 per oz profit margin at $US1,150oz 4E PGM = $US47.5m or $A66.5m Profit Before Tax annually
• $US850 per oz profit margin at $US1,500oz 4E PGM = $US80.7m or $A113m Profit Before Tax annually
• $US1,350 per oz profit margin at $US2,000oz 4E PGM = $US128.3m or $A179.5m Profit Before Tax annually
• 50% of Kalpats which is approximately 3 times the size of Smokey hills
• Potential Cash flow to own more of Kalpats if opportunity exists

Should ‘PLA’ demonstrate and prove its cash generating capacity during the short term, its potential for a multiple revaluation off the back of serious investment is quite simply obvious.

It is appearing on many radar screens, but the information flow is slow and marketing amongst the weakest in the sector. That aside, a solid quarterly/investor update combined with a positive Kalpats feasibility will send this stock to a new level.

The next three weeks look to be very interesting.

IMO only