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CAP

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9.4¢ carpentaria resources ltd

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Hottin

6,457 Posts.

348

06/12/19

18:26

Post #: 41841904
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Originally posted by pygmyhipppo ↑

For what it's worth, here's my take –all highly subjective and only my personal view, no advice:

CAP currently has a MC of $7.7M. Cash was $2.5M as at last Quarterly, with an expected expenditure of$720k in this quarter, so I'll call that $1.8M in the kitty at the end of this quarter.

That gives us an EV of $5.9. To me that's cheap for 69.8% of Hawsons, and I've put my money where my mouth is and topped up a little today. I guess it goes back to the old truism: It's worth either a whole lot more or nothing at all.
At the moment it's dead in the water as there is no clear path forward to secure funding for the BFS, let alone a timeline, but this could change quickly. And once there's a credible pathway to fund bringing it into production, I'd expect it to fly. Personally, I'm happy to sit on my shares for a few years if I need to, but of course that raises the issue of opportunity cost - each to their own.

On top of these points, here are a few negatives and positives that strike me - in no particular order:

Negatives:

Capex of USD 1.4 Billion to bring Hawsons to production is steep for a minnow

Only 34% of shares held by top 20, only 2 substantial holders – lack of cornerstone / institutional investors

I would guess that at the current rate of spending, they will need to raise capital again in the next half year - not a tempting prospect at current share price

Chart looks so ugly not even its mother could love it

Positives:

Tiny market cap for a project like this, massive upside if it's a go

Outstanding high-grade deposit

Product should be in high demand once mine is in production

20 year mine life

Good location not too far from infrastructure, which is a biggie for an iron ore deposit

Great team

Manageable number of shares on issue

Time will tell. All IMO, DYOR.

Expand

Negatives:

Capex of USD 1.4 Billion to bring Hawsons to production is steep for a minnow
- Profit at only $40/t (PFS) USD$400,000,000/year - today it would be USD$600mil

Only 34% of shares held by top 20, only 2 substantial holders – lack of cornerstone / institutional investors
- I'm sure the board is working on this - we need strong investor to pull others in.

I would guess that at the current rate of spending, they will need to raise capital again in the next half year - not a tempting prospect at current share price

Chart looks so ugly not even its mother could love it -

Positives:

Tiny market cap for a project like this, massive upside if it's a go - Absolutelly, massive upside.

Outstanding high-grade deposit - Yes, find me another project that produces 69.9%Fe

Product should be in high demand once mine is in production - Correct, easy to sell even on Sunday

20 year mine life (possibly 30y or more)

Good location not too far from infrastructure, which is a biggie for an iron ore deposit

Great team - Totally agree and that's why I'm in.

Manageable number of shares on issue
CAP Price at posting: 2.9¢ Sentiment: Buy Disclosure: Held
2 Upvote

0 Great analysis

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