galaxy postpones hong kong ipo on poor financi, page-17

Are you fair dinkum Mick? After bonds are converted they will have ~300 million shares on issue (assuming they are converted around ~$1.07 per share). Then there is a $60 million dollar senior debt (i.e it gets paid before share holders if the company goes into recievership.

So assuming the price for the 99.5% stays the same, and assuming the plant is built on budget and on time and works and people buy the product (there are not even any off-take contracts) then EBITA should be ~$17 million pa. Take out $7 million for the senior debt, and another $3 million for tax and your left with ~$7 million profit pa, and that is after spending ~$93 million on opex. Thats an ~8% margin and there the name for that in the resource industry is bankrupt.

On fully diluted P/E of 10 share price should be 42c. Apply a 50% discount for risk with shipping, plant, off take and price and you get 21c per share. Thats the sort of number the people in HK would have been thinking not $1 per share.

The GXY SP has been manipulated for years now it is so high they can't raise the money they need.

Disclosure, I would not pay 10c per share and am just info and experience