Blythefan, i have run the new numbers as well and if prices stay like this and AUD/USD is around $0.85 then conservatively they will make around $300m EBIT. @ 7x EBIT i get a market cap of $2.1b. lets assume they raise $300m in capital @$0.75 = 400m shares plus the existing 200m leaves them with 600m shares.
This would give a share price of close to $3.50. When it goes to 10mpt assuming the same AUD/USD Fx rate and same Fe price then EBIT would be close to $500m. @ 7x EBIT i get a market cap of $3.5b. again, assuming they just use debt to add the extra capacity then i get a share price of around $5.80.
as i said few weeks back the dilution is the thing thats going to hurt existing AXO shareholders while all the new equity investors get a ride on our back. i also said that i was worried that the potential for a big equity raising was going to put pressure on the price. these look like happening now.
we wouldnt be having these chats if management pulled their finger out and got a few quality brokers to provide some coverage. i am very frustrated with the apparent aggroance of the management to not actively engage brokers. i wonder how may shares Indus have now? I should do a shareholder search to find out.
by the way, does anyone know how much vanadium each ton of Fe concenrate will have? I want to work out how much the Chinese companies are actually going to end up paying per ton of Fe after they get the benefit of the Vanadium content.
AXO Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
