RRL

1.45%

$2.04 regis resources limited

outstanding post

First 58 Last

Share
Profile

Follow
Tonestar99

112 Posts.

3

11/08/21

17:46

Post #: 55211761
Share

Originally posted by zog: ↑

"That logic means RRL would/should have the capacity to overpay market value for any proven & producing assets.....somehow that doesn't gel"
I really don't think you can understand how an auction works. When you are in an auction you go through a process where competitors fall out along the way and if you are he highest bidder you get the asset. Taking you logic every competitor who dropped out you will have overpaid. I look upon it differently - all an auction says is that the asset is worth more to the winner than others who dropped out. This happens every time there is an auction it's just that the asset is worth more to the winner than others - not that the winner has overpaid. In RRL case they needed to dilute the hedges they had with Macquarie and move their production up by 100kozs to put them just below 500kozs (which with McP would put them just under 700kozs).

Tropicana is also a cash producing resource NOW and counts to RRL's bottom line NOW - you really can't compare it to developing a new resource of buying up an old mine (they say old mines never die they just get deeper). The problems with old mines is that as they get deeper they also get more expensive - which can still work in a rising gold price environment but is risk, more capex and like an "English gentleman" takes TIME. Tropicana is also an asset with prospects - IGO/Anglogold had spent a lot on exploration - it's risk but would have been closely examined during due diligence - hopefully RRL did their homework.

An issue I don't think has been fully appreciated by the market is that as production goes up value multiples also increase - this means that RRL's competitors in the auction also need to be of a status to raise the $1bn required and also have to ability to get up to the production levels which justify that payment. In RRL's case they also had a legacy hedge issue which needed to be resolved - Tropicana did that.

To get up to the multiples that companies like EVN have they also need McPhilly but that will also need capex and TIME - I have to hope that this will come through - i realize that's a risk but hopefully RRL are confident. McPhlly will hopefully come through in time - any company can only do so much development at any one time (and within its resources) without getting indigestion - the advantage of Tropicana to RRL was that it allowed them to increase production without indigestion and cover a bad hedge situation in one go - IMO that's why they paid a bit over the odds and it was worth it to them.

From my perspective I was not a shareholder before the Tropicana bid and did not carry the pre-Tropicana legacy valuation - this is a problem faced by many shareholders; they find it impossible to forget what they paid - the only one who worries about that is themselves. To a new shareholder (like me) their sales create an opportunity - all I have to consider is it good value NOW - I'm not too concerned about what others paid prior to the Tropicana bid but their sales (hopefully) creates good value for me; thanks.

Expand

outstanding post

RRL Price at posting: $2.37 Sentiment: Buy Disclosure: Held
Upvote

0 Great analysis

Reply

Top Stories

The market's shrugged at China's stimulus measures all year. Why is this one different?

The winners & losers on market if negative gearing were gone

DEG

HotCopper users muse on De Grey's denial of Agnico Eagle takeover bid – but who are Agnico?

NAM

ACCC seeks Olam divestments before it can buy Namoi Cotton

COD

Coda Minerals (ASX:COD) enters rights issue to further exploration in South Australia

ESR

Estrella first foreign entity to win tenements in Timor-Leste under new laws ahead of 2025 tenders

ACW

Actinogen Medical ramps up Alzheimer’s treatment trials, targeting fast-track global approvals

Week 39 Wrap: What HotCopper’s watching; China’s new stimmy moves boost metals; Oz CPI drop

STK

5.6g/t gold intercept at Serbia's Rogozna supports Strickland's hopes for high-grade core

KAL

KalGold rolls out detailed aeromagnetic survey across Pinjin project

There are more pages in this discussion • 288 more messages in this thread...

First 58 Last

Add RRL (ASX) to my watchlist

(20min delay)
Last $2.04		Change -0.030(1.45%)		Mkt cap ! $1.541B

Open	High	Low	Value	Volume
$2.05	$2.06	$2.02	$4.922M	2.420M

Buyers (Bids)

No.	Vol.	Price($)
1	18000	$2.03

Sellers (Offers)

Price($)	Vol.	No.
$2.04	156312	12

View Market Depth

No.	Vol.	Price($)
2	46000	2.020
4	22984	2.000
1	6984	1.995
1	7246	1.990
2	17246	1.985

Price($)	Vol.	No.
2.040	103171	3
2.050	15383	3
2.060	16615	3
2.070	13448	3
2.080	12289	3

Last trade - 16.10pm 27/09/2024 (20 minute delay)

RRL (ASX) Chart

outstanding post

The market's shrugged at China's stimulus measures all year. Why is this one different?

The winners & losers on market if negative gearing were gone

HotCopper users muse on De Grey's denial of Agnico Eagle takeover bid – but who are Agnico?

ACCC seeks Olam divestments before it can buy Namoi Cotton

Coda Minerals (ASX:COD) enters rights issue to further exploration in South Australia

Estrella first foreign entity to win tenements in Timor-Leste under new laws ahead of 2025 tenders

Actinogen Medical ramps up Alzheimer’s treatment trials, targeting fast-track global approvals

Week 39 Wrap: What HotCopper’s watching; China’s new stimmy moves boost metals; Oz CPI drop

5.6g/t gold intercept at Serbia's Rogozna supports Strickland's hopes for high-grade core

KalGold rolls out detailed aeromagnetic survey across Pinjin project

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News

outstanding post

Top Stories

The market's shrugged at China's stimulus measures all year. Why is this one different?

The winners & losers on market if negative gearing were gone

HotCopper users muse on De Grey's denial of Agnico Eagle takeover bid – but who are Agnico?

ACCC seeks Olam divestments before it can buy Namoi Cotton

Coda Minerals (ASX:COD) enters rights issue to further exploration in South Australia

Estrella first foreign entity to win tenements in Timor-Leste under new laws ahead of 2025 tenders

Actinogen Medical ramps up Alzheimer’s treatment trials, targeting fast-track global approvals

Week 39 Wrap: What HotCopper’s watching; China’s new stimmy moves boost metals; Oz CPI drop

5.6g/t gold intercept at Serbia's Rogozna supports Strickland's hopes for high-grade core

KalGold rolls out detailed aeromagnetic survey across Pinjin project

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News