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Its hard to put a value on LCK at the moment...but if everything...

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70 Posts.

33

09/11/21

13:55

Post #: 57428689
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Originally posted by Asterixr: ↑

Having spent too much time locked down during Covid, I put together a simple spreadsheet to forecast LCK's earnings.
At full production in 2025/6, 1mt x $650/t less $150/t cost of production = $500m.
Now deduct $20m opex, $80 depreciation and another $120m in interest (I've assumed all the $2.3bn is borrowed at 5% as making equity issue assumptions is too complicated). Deducting a further $80m (30%) for tax and one gets a NPAT of $200m or 20c/share (assume 1,000m shares).
A 15x multiple (because these are steady, predictable and conservative earnings) gives a SP of $2.50. The NPV over the next 30 years, using a 6% discount rate is $3.5bn or $3.50/share.
It will be interesting to see what value the market attributes when the company announces how they plan to fund their 30% share of the project as DL E&C Co are funding the other 70%.
We live in hope...

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Its hard to put a value on LCK at the moment...but if everything plays out like they are predicting .
I see LCK loosing its small cap status within 5 years .

LCK Price at posting: 12.0¢ Sentiment: Hold Disclosure: Held
5 Upvote

0 Great analysis

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