Saw a Argonaut broker report for another ASX hard rock outfit (that will remain unnamed ) which included this peer chart. The black vertical lines represent the amount of Jorc "Reserves" .
Report was dated 8th July 2021
It specifically points out AVZ as an exception to all other peers?? It states:-
"... The EV/Li2Oratio typically increases with advancement of project maturity. Projects
at Resource definition stage generate an EV/Li2O between $80/t & $224/t. The
EV/Li2O ratio value effectively doubles for projects with completed pre-feasibility or
definitive feasibility studies. With the exception of AVZ which owns the Monano
project located in the Democratic Republic of the Congo, all companies trade with
an EV/Li2O ratio between $413/t and $704/t. Interestingly this is true irrespective
of the scale of total contained Li2O tonnes...."
Ive circled AVZ in red above... It is the only hard rock outfit which has this large disconnect between tonnage and EV and project Stage.
My question is why is AVZ an exception to the rule... ?? . It does not make sense to me that all hard rock outfits fall into a general rule except us.? I note that there are 2 Mali deposits and one in Zimbabwe but they are all valued the same. Except us Why?
Now the broker report is dated 8th July and we have nearly doubled MCap since then but this would only give us a EV per tonne of Approx $200 when we should be $600+
So we are MASSIVELY undervalued based on what resource we have and project stage nearing finance/ML compared to ALL other Peers. We should be valued with an EV near $600-700/tonne .... You can all do the Math 401mt @ $650/t = $2.6Bill
Given we will own 75% of project shortly then fair value once 75% acquired is at least an EV of
$1.95 Billion
Note: This is not putting us as overvalued simply putting us at Par with our peers group
PS: The charts above were on mcaps @ 8 July 2021 subsequently prices of all these lithium peers have risen in the last 4 weeks so I am understating updraft with my figures above. We should be well over $2Bill in retrospect.
