Predictions for Leo coming out of suspension…, page-3

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JoshuaL

3,508 Posts.

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31/01/24

11:22

Post #: 72154718
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Originally posted by nicwix: ↑

Given Leo’s 19 Jan announcement which stated: “The Company will provide an update when a settlement with the Mali Government has beenreached and we are working towards achieving that in the coming weeks.”, what are people’s predictions and expectations for when Leo will restart trading and what the opening price and subsequent movements will be and also what will happen with Firefinch’s shareholding?

Since the Mali government has little control over Firefinch, but can leverage its power over Leo, I imagine any settlement with Leo would have to include resolution of Morila restitution - that being the case, undoubtedly negotiations are very difficult. Given that, we can only hope that things are far enough advanced to warrant Leo having some confidence in being able to settle in February, but there is no certainty. There is also the ASX-initiated suspension to deal with.

Regarding share price, Leo will be adversely affected by: a) its reduced stake in the Goulamina, b) enhanced weighting of Africa risk (especially Mali) and c) general slump in the lithium market (most lithium stocks have decline 40-50% since Leo last trade in July). On the upside, Goulmania will still be a world class, low-cost lithium mine and the Ganfeng relationship is a key strength.

I expect Leo to reopen around 30c then drift down towards 20c before recovering somewhat as mining commences. In the medium term (18-24 months), spodumene prices should rebound and along with the stage two expansion, should provide strong upside. I remain a hold for now.

Thoughts?

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unfortunately I believe you will be correct IF it comes back, I can see a lot of super funds and large investors jumping straight away in case it goes back into suspension like the last 2 times, retail will never drive the SP up, with well over 1 Billion SOI it will be a long slow hard slog to get back out of the 20s IMHO, Leo is a minority now and will be controlled by the major

LLL Price at posting: 50.5¢ Sentiment: None Disclosure: Not Held
3 Upvote

2 Great analysis

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