Tirupati Graph. Share Chat (TGR)

Spread 32.5 - 34.00 sells at 33 are in reality buys

I think there is negativity across all shares in every sector at the moment. People believe they can sell now and buy the same shares back cheaper. This is certainly true at the minute for most shares. I guess it's whether you are prepared to take the risk of selling , probably at a loss, and not miss the boat when it does go back up. I am hoping my patience will pay . Fingers crossed.

I know the market is not good, But in the recent interview Shishir clearly said that the company is going to be profitable this year. Looks like some sellers are not done yet, why would anyone sell below at IPO price? What does these sellers know and who are they?

This market is very challenging for most small caps but remember we are producing and selling and the productions is gradually growing. We are not the early stage company just drilling without any revenues and although there have been delays not all is bad. Time will tell but my impression is that we are in an oversold position at these levels and MCAP https://www.proactiveinvestors.co.uk/companies/news/985541/tirupati-battled-nature-s-fury-to-exceed-production-target-says-ceo-poddar-985541.html

Glengarth: 'From the IPO document each 18,000tpa plant had a CAPEX cost of between £4-5.2m.'

Does this include the machinery to feed the plant, or is there slack in the current timetable. Do they work a 24hr operation or a two shift pattern?
Appreciate and help here. It seems the market, if it is forward looking, is pricing in failure.
There is a fine line between success and failure for start ups, but with the new plant and the Hydro-electric power sorted shortly, this could be the difference. Then onwards and upwards.

BB

Disappointing to see the SP at the current levels.
Fortunately, I sold half my stake last year at the 150 high for a decent return, so have banked profit here, but bought again in the 70's thinking it wouldn't drop much further.
Haven't seen anything to change my view on what the company is doing, just a lot of factors out of the company's control which are affecting all markets, especially small caps.
Many investors are looking for short term gains in this period of uncertainty, so stocks like TGR will be out of favour, despite what the fundamentals may suggest, although someone did post an article elsewhere suggesting that HL were looking to invest in these markets again (AIM, etc) having sold a large stake in Shell, so we could see an upturn soon.

May add some more here in due course, but only if taking profits elsewhere to do so.
Happy to wait in the meantime unless I see anything to change my opinion here
gla

Athough we reached 12000tpa in decemeber 21, we only managed to just 1137 tons in the Q4 FY22 (January - march 22) which is 1/3 of our capacity owing to the tropical cyclones.
We had enough of business update and every knows the model is sound and it is great sector, But Investors would be causious unit next trading update is released and SP would bounce around here..
I'm waiiting to khow much we produce in Q1 FY23, If we hit max capacity we could use profit for Capex.

Look at that chart. Finger pointing down. Will reach the lows soon but not until cash position is clarified. Investors are fed up with buying small caps just to run into a big placing at a thumping discount.

I agree with others that maybe some funds are needed at some point but the reality is that we are also generating significant revenues in both Madagascar and in the downstream in India. These revenue will grow in tandem with our primary output increases. As mentioned by Glengarth I would like to see the TSG integration approvals granted by the Indian authorities soon. Overall I think that the current valuation offers an incredible entry point, especially when compared to the highs at 160p. Time will tell, but it's always the same once a share is oversold and money will flow in and selling will reduce once a double bottom has been formed.

Astro thank you for that tip; funnily enough they match the TGR graph.

Why they never stated cash position, my feeling a discounted placing is needed

Agree Cigam.

One option may be if they demonstrate the profitable potential of the expanded modules I don't see why debt funding can't be an option. If they borrow say £2-3m and use £3-5m of profits/cash flow from the enlarged operations to get capacity to the next leg up of 48,000tpa successfully then subsequent profit levels could be used to pay down that £3m and/or start a flexible facility to grow further to the next level of 66,000tpa.

From the IPO document each 18,000tpa plant had a CAPEX cost of between £4-5.2m.

GLA

From the last set of financials (Sept-21), the company had £6.4mn cash on hand. Given we are now 9 months down the track, it will be interesting to see how that figure is looking now.

That’s the key unknown variable and perhaps the reason the SP tanked today. It will be interesting to see the FY results to March, just to get a feel for cash burn and required CAPEX to scale up.

I would hazard a guess that at 4,800tpa in Patalganga, the net profit at a basket price of $3,000/MT may produce another net profit of around £3,000,000 for TGR's coffers - I would like to see TSG deal complete and financials consolidated with TGR's asap, but imagine that operating costs are much lower than the primary side with all its moving pieces on the ground.
Based on figures contained with in the IPO prospectus/admission document, considering a total of £15m was raised at IPO and subsequent placing it's my belief they are more than funded to deliver the 18ktpa plan in Madagascar and the expansion at Patalganga.

GLA

I haven't been invested here for a while but I'm surprised to see the share price this low. TGR is quite a simple company to model so I thought I'd run a few numbers to see if the SP is under or overvalued right now.

Let's see assume that the business achieves 30,000 tonnes of capacity by Q4 this year and that they can maintain this level going forward. On that basis you could expect (roughly) the following:

Revenue - 30,000 tonnes * by assume average sale price of $850 = USD 25.5mn (note that average price was $866 during the last quarter)
Gross profit - USD 25.5m * 50% = USD 12.75mn (GP% was 54% at the last set of results)
Operating costs - assumed at USD 3.0mn, which is a bit of a guess but let's go with it.
EBITDA - USD 9.75mn
Tax - USD 1.85mn (yes I've skipped depreciation for the sake of simplicity)
Net Profit - USD 7.89mn
Convert to GBP @ 0.80 = £6.32mn

Then take current shares in issue = 87 million
Divide net profit by shares in issue to get an EPS of 7.26p
Divide current share price (33.5p) by EPS gives a forward P/E of 4.6x - which is pretty low in any industry (let alone a growing one)

So overall I believe this is undervalued and a buy at these levels. The key thing to understand is the capital cost of building up to 30,000 tonnes and whether or not a new raise is required to fund this. The workings also don't assume any value from the specialty products at TSG.

Good luck to all holders - the market is a minefield at the moment and I don't think many investors are getting out unscathed. TGR seems like a good bet though, particularly amongst the micro/small caps.

CASH update was missing from RNS and Shishir Conviently ignore it in Interview too. When you ignore or hide such important things, obviously market would take it as Bad

I think the RNS has been received fairly poorly because it could be perceived to introduce some uncertainty. There is a delay - not a big one - at the 18kt plant caused by weather. Previously, one tropical storm and its minimal effects on TGR was the subject of an RNS. Today we were told there have been six tropical storms in six months and that they have been pretty disruptive, leaving roads inundated in Poddar's words today and causing the delay. There will be some concerns that as the delay is due to a factor largely out with the company's control (weather) there could be a repeat at some stage. This then leads to concerns over the length of the current cash runway and how the content of today's RNS might affect that, especially as the RNS talks about metalling or black topping 50km of roads - which would presumably be quite expensive to do and was not previously to my knowledge a stated planned capital outlay. I think the market may have responded better a more comprehensive company update rather than a narrower ops update. A company update might have mentioned the graphene composite project or the planned Mozambique acquisitions or the cash position for example, even if just to say there was no negative update. There may be a number of materially positive developments ongoing which could have been mentioned in the RNS but weren't. When something is not mentioned that has been previously, there is a temptation for the market to wonder if that might be a concern - especially when the market is as jumpy and depressed as at present. At the moment, I think if a company is releasing an RNS it should chuck in every positive it can. I am a little disappointed that more was not covered in the RNS but still confident that this company is on its way to much higher production and revenues and hopefully before very long. GLA.

I see nothing wrong with the RNS. Apart from a bit of bad weather, everything is progressing to plan with additional new product discovered as it explores adjacent land, and they are looking to be cash positive this year - so, yes - why such a big drop?

@NEavo246 another stock i got is pensana plc , now that is true speculative stock. They try to build the first rare earth factory in the uk and europe. if they pull it off I can see SP go to the moon!

What has caused the 18pc drop ? The markets are down but not that much. The city obviously didn't like the RNS. I'm waiting for a re entry point but my mate and his son (who I recommended TGR to) still have theirs.

Agree Neavo.

Unlike most on your list TGR actually makes and sells something and is building multiple valuable parts of an in demand supply chain and has a management heavily invested as we.

If anyone can explain how a Bitcoin miner makes money and provides a return I’d appreciate it, I still don’t understand. To me they just ‘mine’ Bitcoin and leave it in their wallet/account - what use is that to anyone? Happy to be enlightened

To add, so many “speculative punts” over the last 2 years in a state; ODX, ABDX, HE1, ARB, COPL…I could go on. Feels like many people are in the same boat at the minute.

The good times will come back eventually to some of them. TGR has a better chance than most .

In a very similar boat Astro - i am cheered up a bit by the interview this morning. Think there are infinitely more dodgy CEOs that Poddar.

Just AVG down from1.00 to 0.77. half year ago people say it steal at 0.80! and look at us now....

Now the combined 12,000tpa capacity is up and running and de-bottlenecked i'd expect the rest of the year to be another strong leg up on last year both production-wise and financially. Indeed, in the interview i've just watched Shishir is targeting cash positive/positive bottom line this financial year. Certainly with industry leading low-capex and the upcoming 30,000tpa capacity this will be very attractive for investors as profits can be re-directed into capex, derisking the investment proposal here. Important to note that a lot of the spending is already complete for this step and now the higher production and sales can fill the company's coffers. Extra infrastructure like the road programme is essential and good to see Shishir is prioritising this to be done by the next rain period.

Looking forward to the next results for last year, the half yearly for this year to September and the end of year results which will hopefully contain that all-important profitability. GLA