in a goldilock scenario GBG is a strong buy. even with 1.5B shares on offer if you look at the "Goldilock" scenario of
IO USD 131 = 143 AUD add 15% premium that makes it $161 AUD rate 8MT at 161= $1.28 Billion.
operating cost they say in the $80 rate interest and repayment at $10 lets round that up to $100 pt leaving $61 spare cash x 8 MT
that leaves about $488M free cashflow and that is after repaying your debt every year. so we get 47% of that which is about 230M PA divide that by the 1.5 billion shares and you get about 15 cents a share not including the 2M dso so maybe 16 cents a share. at 5X you are looking at 90 cents so maybe not a 10 bagger but a 5 bagger is achievable and that is why the holders are still staying on waiting for the goldilock scenario.
At these IO prices and assuming cost are about $80 this is still a stong buy. The problem is we cannot confirm cost yet and management keep us guessing. they reiterate in the quartely that nameplate is on track and then we find out its delayed again.
Major investors invest in good mangement as much as they do in the story.
GBG Price at posting:
13.5¢ Sentiment: LT Buy Disclosure: Held
