Just having a look at few numbers for this assignment.
So the plan is to have 2,500,000 acres of land under jatropha plantation by 2010. Lets say that's producing at a steady state for arguments sake (around 2015?). MBT expects 1 tonne of oil per acre per year. Thus we're looking at a yield of 2,500,000 tonnes of jatropha oil per year.
GEM biofuels did a deal with NFL to supply jatropha oil, at a fixed price of USD$500 per tonne. Now to be conservative, lets say we can make a NPAT of USD$250 from the jatropha oil, including that which we can refine and sell ourselves.
250 x 2,500,000 = USD$625,000,000.00
That is, USD625 million. Current market cap, around 46 million dollars.
Let me phrase it another one, who thinks, within the next 5 years, we WONT have a NPAT in excess of US$100 million a year?
Please comment, i am keen to know other's opinions as this analysis is for a uni assignment.
MBT Price at posting:
$23.00 Sentiment: Buy Disclosure: Held
