Just remember, the npv is in now dollars. So it should have already factored in a discount rate from the future to now, and if sensible included a risk premium and the costs involving in deriving shadow price of some sort for both interest or equity financing. Any NPV worth its salt should do this. Therefore $9B is in fact the value today. But i doubt their engineers would have factored all involved to work out a true economic value for the company. But they dont really say what is involved in that NPV so it really is all inferred.
Therefore i'm quite confortable with a value of $5 in todays dollars as it indeed does (or should) factor in the risk going forward. It also provides a realistic LT investing margin if ppl did indeed want to stay LT if any corporate action falls over.
Also bear in mind, just because it's value is that today, doesnt mean it wont be worth more in the future because of a whole lot of assumptions that would take too long to explain. It also doesnt mean that that would be what someone will pay today for the company today because of assumptions involved in the investing decision. We simply dont have enough information to determine a true company value - just project investment decision
A case in point would be the CFE deal, where they accepted $400M now for a company worth 4X this value. I'm not saying that the company has a $5 price target to NKP or Anglo, but $1 on on their part would be a bargain and i agree, a shift to NKP would be a LT killing.
I hold about 150K in this company and i just wish they would get on with it. I also cant believe the ASX hasnt pulled Tony Sage up on Listing Rule 3.1 for continuous disclosure breaches - as if the deal had fallen over we should know by now or if they are negotiating something else we should know by now as on 5 May he suggested 2 week maximum
Good luck to all continuing to hold this one
Bye for now
MC
IGC Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
