proper valuation less than 25 a share

lets say they produce 100,000 tonnes of zinc per annum
as CBH has 1.5 million resource ala tro at the moment and produce close to that in zinc (no to mention lead)

100,000 tonnes * 1.90 zinc price USD * 2200 (converting pounds to tonnes) * 1.35 (currency conversion)= 564.3 million REVENUE

now use a net profit margin (net profit/revenue) of 30%
and we get $169.3 million

169.3 million divided by 80 million shares = $2.12 per share EPS for 1 year

BUT they need MONEY amd lots of it to drill further and to do feasability and bankable feasability and to develop + its gonna be an underground mining operation which is more expensive

So lets assume approx 300 million shares (almost 4 times) and also including options

so NPAT of 169.3/300 shares + options = 56.5 cents per share approx

give it a P/E of 7 (given that resources could be 3 million tonnes whichll be 20 years + of mining)

56.5 cents EPS * 7=$3.96 per share valuation

change the parameters above to get different valuation scenarios

So share price isnt worth $25 bucks IMO of course

but it looks like its worth more than a buck

therell be a capital raising soonish id imagine once the price goes up quite a bit more???

If they can get more resource from tailings as they say and prove it to be minable reserves, then theyll have 3 mill tonnes of zinc approx

if thatll be the case I think theyll have to build a plant that could handle more than 100,000 tonnes per year???

i dont know , in no mining expert

but previous valuation of $25 are ludicrous given that theyre based on revenues only!

question is: how much money do they need to get this up and running, and how many more capital raisings are gonna occur to dilute capital???

ive assumed 300 million shares; good mining companies ala JBM in nickel acheive NPAT margins of 30%-40%

ive assumed 30%

$3.96 per share with P/E 7

Of course if they can produce 150,000 tonnes per annum, that would give approx 825million revenue based on $1.85USD zinc

30% margin=247.5 net

247.5/300 shares=approx 82.3 cents per share

give it P/E 7= $5.76 valuation

this is all hypothesising and shouldnt be taken as professional advice