It's a bit hard to get a measure on everything I know. Mainly because in Quebec , the two BIGGEST near spodumene producers and / or Lithium Hydroxide hopefuls up to now comprise ONLY the two ' unlisted ' and recently bankrupted operations of NEMASKA and North American Lithium.
And there are others of course like the Vancouver listed Sigma Lithium who I could virtually go on all day about , but for the purposes of this argument , their Brazilian hard rock Phase 1. & 2. were always on a similar comparison to that of Altura.
So in the absence of a market value for the defunct Altura Quebec's Hard Rock and Hydroxides hopefuls would have to be compared more closely to that of Pilbara Minerals. So forget about MIN ....or ORE & GXY because they have different lithium operations and favorable Japanese financing scattered across multiple and diversified Lithium projects inclusive of Brine as well.
But I guess the question would be what would Altura be valued at today if on what appears to be the same favorable financing terms to that of ORE's Japanese Government concessional funding and / or NAL's interest free and honeymoon rate finance provided by Investment Quebec.
And without giving to much thought to that question , I would hazard a guess that Altura with its phase 2. operation up and running would easily be in the vicinity of $1.8 - $2.2 billion . Hence the more recently re-rated market valuation of Pilbara Minerals of staggering circa AUD $4.2 billion.
So coming back to Quebec's own producing and near producing Hard Rock comparable companies , what do you reckon the unlisted Nemaska is worth given that it's Whabouchi mine in Québec, Canada is claimed to be one of the richest lithium spodumene deposits in the world, both in volume and grade.
So the price paid for Nemaska was virtually CAD $146.5 million in assumed liabilities and a further CAD $600 million in committed finance. And that was only for 50% of the interests in Nemaska with I.Q still retaining 50% interest in the overall project. However at a glance , Pilbara Minerals is trading at at least 9 X's book value , so that would put Nemaska at at least CAD $4 billion right now if it was still listed on the TSX today.
So using the same rule of thumb with respects to NAL , if we are trading at 9 X's book value of say CAD $200 million - that is only CAD $1.2 billion ( AUD $1.3 billion ) . Even at CAD $100 million .....or better still lets only use approx CAD $75 million to account for PLL 25% share taken out - At 9 X's book value , that would still be CAD $675 million ( AUD $725 million ) . And of course ALL of this does not even take into account Sayona's current cash on hand of near enough AUD $45 million .
So it would appear with this analysis , it would still only get us back to the same ole same old Sayona with a valuation which does NOT recognize a value for any of it's other significant minerals tenements in Lithium , Gold , or even it's Authier 20 MT JORC defined resource. And so we know that this is not the case when valuing every other Lithium Player in Australia or anywhere else in the world for that matter.
So this $725 million valuation would be ONLY for the NAL operation and nothing else.
Perhaps when the Private Capital funding partners are eventually revealed , the penny will finally drop as to what the ultimate commitment to funding is , and therefore what economic benefits can be finally realized from these Joint projects.
Of course a positive BAPE decision will go a long way to cementing in the combined NPV as well.
However even if we were to say never receive an approved BAPE , we now have a producing plant with a proven resources which has ALREADY been environmentally approved. So regardless of whether we were to lose Authier ( which Quebec does not obviously want ) , we would still have NAL......and which is still worth at least a minimum of AUD $725 million without anything else.
And just finally - I absolutely love the fact that Sayona ....even with all it's new found Glory of acquiring producing Lithium Plant worth over CAD $400 million in its own right ......it can still be regarded as an ' Explorer ' . Because have always stated ...even way back when Altura was still kicking . Being an explorer offers the tremendous ' allure ' and upside potential of discovery whereas a Producer with limited LOM and undefined resource does not. And this is especially the case in the current climate where defined resources will be valued at a premium as we move forward through the inevitable supply crunch.
In other words , the producers who continue to keep exploring and expanding their overall resource base are ultimately the ones who become the next MIN's , FMG , and BHP's of their respective mineral and mining class.
' It's all about the tonnage ' .......and ' Quality ' - which is why it will be important to get the go ahead sign off's from Novonix.
So a 6.5 - 8.9 cent Sayona SP was always a very conservative valuation which I had previously applied. And all you have to do to compare is run the rule over Rock Tech and Avalon Advanced Materials proposed Thunder Bay Lithium HUB proposal to see that that is indeed a fair value representation. For further convincing , just make a comparison to Sigma and it's Mitsui backed Brazilian projects and you will see that I am right. And all of this information was previously provided by myself..... on both of these Comparisons.
So as an investor ....or even trader , you have to be comfortable in your own skin and the values paid for your entries and exists. But you also need to do the research before you go off half cocked making claims of overvaluation and ' Newbies ' getting burnt. In my opinion , nobody buying at these sorts of ' today ' prices will be getting burnt. However if you can't handle a 5 or 10% fluctuation on any given day , you might as well give the Business away.
And so in Sayona's case right now , you need to be more true to the valuation than being true to the Chart and technical's because this movement and re-rate as referenced by a Chart is really only just getting started right now.......
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