Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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Of course the ESG credentials will be key in securing financing. The bankers are going to ask "Are you ESG Jeremy" Jeremy will say yes of course we are here are some powerpoint slides. Look at our beautifully constructed hydro-thingy lot's of clean nickel here"
The bankers will then say OK just checking because we don't want to get in trouble with our WOKE department.
Now about that money you want? Let's see...
Https://markets.ft.com/data/equities/tearsheet/forecasts?s=HZM:LSE#:~:text=The%205%20analysts%20offering%2012,the%20last%20price%20of%2020.75.
Looks like most of the sub 20p sellers are out.
Another 13p lopped off the average.
Most of Indonesias Nickel in under rainforest and they have old style mining which produces toxic waste and are powered by coal fired power stations. Our ESG credentials will be key in securing financing as the end product is more desirable to companies such as EV makers with green credentials of their own.
“Indonesia’s nickel business is concentrated in Sulawesi, where Chinese company Tsingshan runs the Indonesia Morowali Industrial Park (IMIP), a hub of nickel processing set up for the stainless steel industry. While large Chinese companies dominate processing, they are fed cheap ore by hundreds of smaller, mostly Indonesian-owned mines that dot the rainforest.”
“In two recent reports published through AEER and the Rosa Luxemburg Foundation, Rushdi and other researchers highlighted the dangers of deforestation and flooding, as well as labour conditions that push workers into long hours companies are sometimes reluctant to properly compensate.”
Some analysts believe the supply issues could start feeding through to global nickel prices. Citi turned from bearish to neutral, predicting that prices could rise to $20,000 per tonne, up from $18,100 at present, on supply constraints.
“Risks to Indonesian nickel supply are growing due to ore grade depletion, regulatory scrutiny, mining quota issuance delays, rising pressure to address ESG concerns [and] the lower price environment,” the US bank’s analysts wrote in a report. They suggested Indonesia might also use its dominance of global nickel production to reduce supply to push up prices.”
“Reserves of high-grade nickel ore in top producer Indonesia may be depleted in around six years, a miners’ association has warned, risking shortages of the material used to make stainless steel.”
“With such a huge global dependency on supply from the country there is a risk this emboldens Indonesia to exercise its dominant position to behave like a de-facto swing producer by taking actions to constrain supply,” Citi added.
“This risk increases in a lower-price environment.”
Or they get together and make an offer of 270 million for the whole company. Ie a £1 a share. Actual cost to them of $135 million. Plus the cost to finish the project say $200 million and take full value of the company going forward. Lot higher effective SP and the participants are free to exit whenever they like at a commercially realistic price rather than subject to the whims of the stock market
Contingency…typo in header!
Https://www.accesswire.com/674398/horizonte-minerals-plc-announces-proposed-us633-million-funding-package
As we get closer to announcements, the big institutional investors will want to see the company to deliver and will fund both A1 and A2 as necessary alongside some equity deal…the magic 67p won’t be far away! What today holds is what tomorrow doesn’t know…can see speculative buying on positive news to be released…but I’ll leave it to the quants to to the maths and the ifs and buts calcs…gla…
I understand that some are looking for a trade from 15p but given the chance of this moving up rapidly to 30-40-50p even without funding I’m not sure the 3p difference is worth missing out on.
Https://www.greencarcongress.com/2023/11/20231107-sk.html
Interesting read on Nickel content in these batteries.
This feels primed for a good rise even without an RNS.
19p is still nuts IMO. 40p/50p/60p all acceptable for this stage and risk of funding being found but no way 19p. For even the short termers who appeared mysteriously on or around October 2 this is a bag opportunity (minimum) by year end from this price. Then depending on the path chosen further rerate as market absorbs it and we have clarity on exactly when the build /construction completes and we go into production.
Rover62 - LOL, that was going to be my tie break question!
Just trying to lighten the mood, only so much of headder any one board can take
Rover the funny thing is they aren't independent equations. When La Mancha invested they did so on the proviso that this would be a much bigger company than Araguaia1. So in effect now there is chicken and egg - how to fund the extra requirement for A1 while still keeping A2 'in play' because the cornerstones invested for the bigger picture and no they didn't want to shell out an extra $300m each time!
I also think it isn't an accident the A2 DFS has moved back on the funding required. Of course the A1 funding will impact A2 funding (in terms of capex for steel and things has increased for both) but actually how you finance A2 becomes fundamentally important in the A1 financing picture. If A1 royalties/etc. suck the company dry of profit then A2 becomes impossible to fund from FCF so I do really think with the cornerstones around the table a funding solution with much more than half an eye on A2 is being sought which is probably one of the reasons it is taking so long!
I don't think it is the right time to actually fund A2 but to have a plan for how to fund it based on how to complete A1 will be the big discussion at the moment I think. But a leftfield idea would combine for the funding for both but then as others have said it shouldn't involve too much equity as the equity price will be much higher with A1 producing nickel.
When the news broke early October of course it was stressful in terms of the SP action but just as concerning question for me became 'how do we now fund A2' because my investment case was very much for A2 producing. I guess we find out in a few weeks.....
For some outlandish speculation why not combine the current requirements for extra funding with the funding for A2. Lol
I am not sure the Cornerstone investors will be happy with Averages of 35p or 45p. They will be looking at futures prices back in the pounds and not pence. Hence, I expect more debt than equity.
My hope is funding will have been arranged before feasibility report is released - so that we can get a boost. If comes before then there will be little effect in my opinion. we are too weighed down by the insecurity of how funding will happen.
my hope is raising money not through a placing and then a good feasibility report
With the RNS due shortly I wonder if anyone want to hazard a guess on what the FS will come in at for A2?
Remember they did get some of the equipment on the cheap
https://www.lse.co.uk/rns/HZM/acquisition-of-ferronickel-processing-equipment-wpeulds3svyp3xj.html
Wassa I know you love a spreadsheet, contrarian you know everything that has happened and is yet to happen so if you guess last as you’ll obviously win :)
I’ll go first with £385million, higher or lower.
Anyone who works in Construction will appreciate that it is about risk management. Things won't always go to plan.
In fact, they will nearly always not go to plan, you just hope the variation from plan is not costly or someone else's financial responsibility.
I agree with Bridge that this BoD have done some very astute things and did very well to achieve finance, even if it wasn't perfect for us investors.
I do think this will rise when a finance deal is agreed, which I'm confident will happen. I think the rise will be fragmented though. For example, anyone who was invested at £1.40 and has now invested the same as their original investment at 20p will now have an average of 35p. It is human nature that they will be tempted to sell once break even is achieved, having once feared they may lose their original investment, even though they may believe in the long term story. Once bitten and all that..
There will also be others who haven't averaged down but will maybe do so once finance is confirmed, even though the sp may have double from here, it'll still be a good average down with less risk than they may wish to accept right now.
You're not being that careful, you called them crooks earlier.
I don't know why you need to be so disingenuous and call people incompetant and fools with no real knowledge.
Let people think for themselves and make their own investment decisions based on the research they wish to carry out or not.
You could add helpful comments but name calling and drivel are just blocking useful debate.
I am saying incompetent and being kind and careful...
Nothing wrong with a caravan chap. Mine probably cost more than most people spend on a house. But who cares. I am here to make money. And I have a feeling it will be more than you here. Anyway cheers all. See you at sixty pence. And probably be a few weeks but it will come. Gla.
I’m not sure the board are incompetent. They bought an asset with £300m spent for £7m. Then got a great financing package. Unfortunately interest rates and inflation are running high and there’s been an issue with a supplier. What else should they have done?
Definitely a few posters that have envy issues and are still stuck in the first stage of loss rather than having moved on