NIC

2.48%

78.5¢ nickel industries limited

Valuation, page-3

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pcman2

323 Posts.

164

14/06/21

09:50

Post #: 53827006

Originally posted by AnDy62: ↑
Some will remember I posted this analysis during 2020 before the prospective Angel Nickel (ANI) acquisition.

The info I've taken from the presentation to Macquarie in May 2021. Of course, since production from ANI is not expected to commence until Q32022 this is a 'prospective' valuation. It also largely ignores the nickel matte aspect of production, which is I understand may close the payability ratio (from circa 85% - conservatively used in the analysis, to 1).

With a final instalment to pay off on ANI the shares on issue may increase further, which would reduce the valuation per share, but not majorly.

Inputs

1
ER 0.78
2
SP $1.08
3
Nickel price (US/ton) $18,300
4

5

6
Mine New
7 Hengjaya Nickel RKEF Project (HNI) Ownership 80%
8 Ranger Nickel RKEF Project (RNI) Ownership 80%
9 ANI Project (ANI) Ownership 80%
10

11 Hengjaya Nickel RKEF Project (HNI) Production (tonnes) 17,280
12 Ranger Nickel RKEF Project (RNI) Production (tonnes) 17,280
13 ANI Project (ANI) Production (tonnes) 36,000
14

15
Nickel price ($US, tonne) 18,300
16
Cash cost ($US, tonne) 8,650
17
Payability 85%
18
EBITDA margin (/tonne) 6,905
19

20 Hengjaya Nickel RKEF Project (HNI) EBITDA 119,318,400
21 Ranger Nickel RKEF Project (RNI) EBITDA 119,318,400
22 ANI Project (ANI) EBITDA 248,580,000
23
Total ($US) 487,216,800
24

25 Number of shares NIC 2,531,200,000
26 EBITDA/share ($ US) NIC 0.192
27 US:AUD
1.82
28 EBITDA/share ($ A)
0.247
29 Price $1.08
30

31 PE* (EBITDA)
4.38
32 Estimated fair value PE
10.00
33 Estimated fair value price
$2.47

Now, this analysis doesn't include corporate tax due to the concessionary period still having circa 5 years to run, say 4 years when we churn out the cash at double the volumes. Management will surely look to increase dividends, perhaps significantly, during this period. My person opinion is that the nickel price is also set to move over US$20,000 by the end of the year.

Good luck to all holders, especially those who have weathered this slow H1 of the year. I think the patience will be rewarded.

Have a good long weekend and as always DYOR.
Expand
Hi AnDy62

Thanks for your updated figures.

I believe your figure for the Angel project for the estimated production should be 28,800 which is 80% of the total 36,000 on 100% basis

Could you please update your figures.

cheers
pcman2

NIC Price at posting: $1.09 Sentiment: Buy Disclosure: Held

1 Upvote

0 Great analysis

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Last 78.5¢		Change -0.020(2.48%)		Mkt cap ! $3.364B

Open	High	Low	Value	Volume
81.0¢	81.3¢	78.5¢	$3.137M	3.942M

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Price($)	Vol.	No.
0.795	50394	2
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Valuation, page-3

iTech Minerals flags high-grade rockchip finds, boasting one sample at +18% copper. What lies underground remains to be seen

Macro Metals picks up 80% in Firebird's manganese plays; mining services operations to launch if decision to mine passed

Dart on-target for high-grade structures and multiple reefs at VIC's Rushworth

Arafura updates on total US$1B funding as export banks and lenders take notice; heading toward FID for Nolans

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	Inputs
1		ER	0.78
2		SP	$1.08
3		Nickel price (US/ton)	$18,300
4
5
6		Mine	New
7	Hengjaya Nickel RKEF Project (HNI)	Ownership	80%
8	Ranger Nickel RKEF Project (RNI)	Ownership	80%
9	ANI Project (ANI)	Ownership	80%
10
11	Hengjaya Nickel RKEF Project (HNI)	Production (tonnes)	17,280
12	Ranger Nickel RKEF Project (RNI)	Production (tonnes)	17,280
13	ANI Project (ANI)	Production (tonnes)	36,000
14
15		Nickel price ($US, tonne)	18,300
16		Cash cost ($US, tonne)	8,650
17		Payability	85%
18		EBITDA margin (/tonne)	6,905
19
20	Hengjaya Nickel RKEF Project (HNI)	EBITDA	119,318,400
21	Ranger Nickel RKEF Project (RNI)	EBITDA	119,318,400
22	ANI Project (ANI)	EBITDA	248,580,000
23		Total ($US)	487,216,800
24
25	Number of shares	NIC	2,531,200,000
26	EBITDA/share ($ US)	NIC	0.192
27	US:AUD		1.82
28	EBITDA/share ($ A)		0.247
29	Price	$1.08
30
31	PE* (EBITDA)		4.38
32	Estimated fair value PE		10.00
33	Estimated fair value price		$2.47

Valuation, page-3

Top Stories

iTech Minerals flags high-grade rockchip finds, boasting one sample at +18% copper. What lies underground remains to be seen

Macro Metals picks up 80% in Firebird's manganese plays; mining services operations to launch if decision to mine passed

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Arafura updates on total US$1B funding as export banks and lenders take notice; heading toward FID for Nolans

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Buyers (Bids)

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