Three things will kick start growth in valuation: offtake,...

Three things will kick start growth in valuation: offtake, offtake, offtake.

What could the share price get to? A couple of ways of looking at this.

1. Compare to MNS valuation (say $300m): based on 76mt @ 4.8% TGC = 3.65mt graphite concentrate = $82m market cap per million tonnes graphite concentrate

The latest GPX drill program is expected to more than double the PFS resource of 9.2Mt = 18.4Mt /2km drilled or 9Mt per km drilled x 54km of strike identified by our geophysics = 486Mt @ 10% TGC = 48Mt graphite concentrate x $82m/mt = $3.9billion / 2 (assuming 50% equity after Chinese fund construction) = $35 share price

2. How much can we actually sell? Say we provide the Chinese building materials market with 500ktpa expandable (about 50% of our product) + 500ktpa of the other stuff that goes with it, for batteries, refractory = 1mtpa.

Our PFS comes up with NPV of US$200m for 69ktpa = $2.9billion for 1mtpa / 2 (assuming 50% equity after Chinese fund construction) = $25 share price

So a share price range of $25-$35 is justifiable, or $18-$25 fully diluted.

Why don't the Chinese just buy Chilalo outright? They might, but shareholders would have to approve it....question is what would we sell for? I could be talked into $10 once offtake and finance in place.