I am probably one of the more conservative posters but I think I will give a view on some of the MC and SP predictions been floated around on here
1. This nonsense of $39 billion MC is nonsense. With 6.5 billion SOI (assuming all options converted), your EBITDA at PE/20 needs to be about $2 billion per year. A crap load of resources and a crap load of carbonate/hydroxide facilities would have to be in place for even that type of MC to even be dreamt about.
In post
Post #:55297938 I provided this table, now revised for SOI, based on previous studies of Authier which I know are old.
![https://hotcopper.com.au/data/attachments/3521/3521306-444761740741d34ccac953767580779e.jpg](https://hotcopper.com.au/data/attachments/3521/3521306-444761740741d34ccac953767580779e.jpg)
Just using the above, and just doubling spod price (previously US$693 per tonne), would still not get you near say $2 SP. Nor would adding the NAL carbonate facilities, assuming they work at scale as assumed (see below). This is before we get to level of resources needed btw to work at that scale. A key for SYA is actually doing more exploration/drilling and identifying more resources.
Clearly more resources are needed to extend mine life which teh NAL acquisition is a very very good start.
PriceNow the PLS sale everyone talks about is a spot sale at US$1250 per tonne. Most of PLS sales are under long term contract that reflect movements in carbonate and hydroxide prices, with the spod price received significantly less than this headline figure - you only have to look at their latest quarterly and do your calcs. A lot less. You need long term contracts to support a project - spot sales are just spot sales and they are a trigger for new production which means prices stabilises - there are quite a few lithium projects in C&M put there when prices reduced in 2019 and 2020 that can be switched on to provide new supply and impact price. Without going over old ground one needs only to look at the last time prices went sky high of just a few years ago what new production did to the spodumene price, albeit this time I see prices been more stable, probably averaging the US$700 per tonne long term -
Post #:55299282 - with the thread where this post came from given more data/information. Some of the forecasts been branded about are just not workable, especially given they are not forecasting the rate of growth in carbonate and hydroxide prices, as spodumene prices do have a relationship to those prices.
.NAL facilities:The other day I posted on these. A great purchase and lot to like for SYA but some need to get a perpsective on these facilities. But one thing I am mindful of is the plants still need to get to capacity as well as the fact the donstream processing plant produces lithium carbonate, whereas the growing market is hydroxide, as well as teh fact the spodumene element of teh facility was producing grade of between 5.5% Li20 - 6% Li20 -
Post #:55641248. It is not easy as some think on here that you can just flick a switch and presto hydroxide is produced so probably will need to maintain carbonate production but over time build your own hydroxide facility. The growing market in EVs is hydroxide, not carbonate. The other thing I noted is the spodumene aspect of facility requires a feedstock of about 1.2% Li20 to work properly so still more work required and capex spend to get that facility to utilise the lower grades. So will be interesting when SYA provides its feasibility updates, but certainly a lot of capex savings are to be had by having been gifted a working plant albeit some capex spend still required.
Yes happy SP has grown well here, but some perspective on what is realistically achievable for SYA needs to be had here, including what is feasible production here based on its resource mix and current plant configurations. As I said the feasibility studies here we be interesting on the upscaling and how they will get the NAL plants to work at scale.
A lot of water has to still go under the bridge before one can start yabbering about $5 billion market caps, let alone ones higher than that, and the key to any of that is getting and finding more resources as well.
I am going to put some posts up for people who like to research:
1.
Conversions for those that like working with data -Post #:50067962,Post #:50071578andPost #:500717412. Understanding hydroxide/carbonate/spodumene and processing options and grade/deleterious elements: start with this one in this thread and scroll down -
Post #:542837273. Convert data to lithium need -
Post #:378174514.
Update on data around demand and amount of new spodumene mines -Post #:55224139, which d
oes depend on mix of carbonate/hydroxide -Post #:55224139.Not sure when I read this thread what is going on - we seem to have traders trading day to day, medium term holders who look like will leave prior to production and those aiming holding long term through production. AI am dividing that hype between short term, medium term and ling term. Getting to production a lot needs to happen for some of the SP predictions on this thread even having a remote chance of coming into been - and the key start is actually getting to production and then using your profits to identify a lot more resources etc.
What will IMO be a good catalyst here especially given SYA is located in North America is a nice binding agreement with a North American player, which will be based on what the buyer thinks SYA can supply realistically (which goes back to what can realistically be supplied from Authier and NAL).
All IMO