Here’s a fairly crude valuation of the options. The options are excercisable at 25c, so as soon as the fully paids get high enough above 25c then the options and fully paids should move cent for cent.
Say the fpo’s are trading at 60c, the options would be 35c (without taking into account any time value).
For the fpo’s to go from 20c to 60c is a 300% gain.
To get an identical gain from the options, they would need to be trading at 11.7c when the fully paids are 20c (ie. 11.7c to 35c for a 300% gain).
Most traders would probably want up to twice the leverage out of the options in comparison to fully paids, which would sit the options at around 5-6c when the fully paids are trading at 20c.
A little bit of a run between now and when they list towards the end of September and it wouldn’t be difficult to see the options start trading at around 10c.
Would be nice to see the cap raising oversubscribed too. Then we might get a lot more buying on market once people get their cheques back in the mail.
Cheers, Butcherano.
BKP Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
