According to Commsec, CGT is capitalised at $64M. (this equates...

According to Commsec, CGT is capitalised at $64M. (this equates to 1,523M shares at 4.2 cents). Development to production of 50,000 oz per year is funded by cash on hand and the recent $25M raised is for future prospective programs.

50,000 oz per year at a production cost of $750 per oz (according to Matthew Gill) means an income of $37.5M per year. So the Capital Value ought to be $375M plus $25M plus some premium for potential.

Even with no potential factored in we get a CV of $400M. At 1,523M shares that equates to a share price of 26 cents. Or look at it another way:- this company has no debt, $25M for additional development and exploration and you can buy it for 4.2 cents per share and yet by September it will be earning 2.4 cents per share per year. I bought TPG telecom at 20 cents because they said they were going to earn 7 cents per share. TPG telecom (code TPM) went to $2.50 by doing nothing more than following through with what they said they were going do.

Think about it. You can buy a 26 cent share for 4.2 cents. Now look at the top 20 share holders at :

http://imagesignal.comsec.com.au/asxdata/20110505/pdf/01177885.pdf

It does not just have a sprinkling of national and international finance institutions, it is absolutely chock a block full of blue ribbon institutions.

So if you think you can wait for 3.0 to 3.3 cents to top up or get in then you are taking a very big risk indeed. This stock is incredibly under priced. It is also ill-liquid, so when it starts to run it will not be easy to purchase stock.

I'm not going to suggest a conspiracy on price manipulation or a possible take-over. I am just saying that people ought to wake up and start buying. Anyone that sells now will probably regret it come September when gold starts pouring.

PS I welcome any corrections or suggestions with respect to my figures and calculations. The main assumptions are approximately: 50,000 oz per year programmed production, $750 per oz production costs, Gold price at $1,500 per oz, 1,523M shares (1.528M according to the top 20 share holder register announcement), $25M for future development from the capital raising.

I have no barrow to push other than being a CGT share holder. Please do your own research and do not rely on mine.