Dreams are free - nicely put Carna. I think we are just spit-balling (whatever that is) while we wait.
There are several issues that could influence a higher sp, many of which have been discussed and most seem to be reasonable, or at least not impossible, to some degree:
First off the rank is that the BFSs are all noted as 'conservative'. I presume that there will be more detailed and up to date statements between now and the start of the first construction (do they need to do this for financing?). These could show higher sale prices and margins, and ramping up to nameplate capacity for the initial plants based on strong demand for products. Doubled production and increased margins obviously more than double the value of the enterprise. If any new Feaso is prepared, I l know I will be cranking out some spreadsheets to see the possibilities.
Given the very strong indications reported from potential customers and the enhanced port capacity at Geraldton, there seems a possibility, at least in my mind, to add more plants to Arrowsmith projects on a modular basis. These could increase overall production by 60% (going from 3 plants to 5). Enterprise value pro ratas up on the back of this.
A joint venture manufacturing facility in WA to utilise the local inputs of sand and gas - do they still use limestone for glass? This has been periodically talked about by VRX so it is not impossible or too left-field. I don't think it is first order business but could be absolutely massive down the line. I have no knowledge to bring to this but could imagine a scenario of a manufactured product generating 10 x the export profit per unit of sand input. It could be far far higher, but I guess if it were much lower, the risk would deter any go-ahead. If you add capacity to Muchae to manufacture, could you more than double the earnings from that project?
What is Boyatup worth - how realistic is the development of that once the Arrowsmith and Muchae projects are in full swing?
Do the Biranup gold explorations add anything to the company value - gold stocks are going off like rockets all over the shop?Are there any other good news prospects on the horizon that I have missed?
As to take overs, well, never say never, but I think this is tightly held and the top 20 all see the massive potential in this business and would not be selling a any sort of discount IMHO. If a fair current value once plants are running was $2 to $3, they might not be prepared to sell for anything less than a 100% premium. They could have my million shares for 5 bucks a piece!
Cheers,
Keith
VRX Price at posting:
19.5¢ Sentiment: Buy Disclosure: Held
