Opening on Monday, page-26

This is my take on it- risk is reduced and potential upside is huge if lithium market improves.

So they now have 3 years breathing space for the lithium market to improve and to generate some cash,get refinancing and or pay off the debt,plus continue to improve plant production and possibly commence stage 2 expansion,although this will probably require additional funding. .The fear of an A40 type VA/insolvency is gone, which was no doubt making lots of investors nervous.​

Current production based on the last half yearly say 185,000 wmt per annum, which is probably a worst case scenario as production was improving.​

From the half yearly report costs were identified as U$ 359 per wmt.I,m not sure what the conversion to dmt is- I think I,ve read somewhere that there is an 8% difference, so lets say costs of U$387 per dmt.​

Based on current terrible lithium market, and current floor price of U$550 per dmt, thats a surplus of U$163 for every tonne produced, so based on 185kt per year a cash surplus of U$30million per annum- out of which interest and capital repayments need to be made, which is not a great situation, but is probably a worst case situation.​

However, lets say the lithium market improves.All of these conversion factories that were under construction or being commissioned get finished, and require feedstock to supply the ever increasing number of car manufacturers producing EV,s and requiring batteries for them..Altura are now a proven and reliable spodumene supplier, unlike other struggling suppliers such as A40,PLS,GXY.If the lithium price improves to say A$750 per tonne, then AJM would be generating ,based on current production of 185kt per year, a surplus of U$67million per year.If the ceiling price of A$950 is achieved, the surplus ​

becomes U$105m per year- more than enough to pay off interent and capital.​

If stage 2 kicks in and production increases further, things get even better.​

Whereas the above is pure conjecture, its pretty obvious that if the lithium market improves then there is the potential for huge upside in AJM, and there now exists 3 years breathing space for this to occur, coupled with the fact that production is likely to improve to closer to the 220kta nameplate output over the next year......and any refinance which improves the current interest rate will dramatically improve the upside.​

If AJM opens on Monday below 6c I,ll definitely be buying a few more to add to my existing ​

holding.