Proposed Directors of Tirupati Graphite explain why they have requisitioned an GM. Watch the video here.
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Thanks RKB and PrimForAll I'm very happy with this share and the way the company has been turned around with the new board.
GLA
Thank you, Rupert.
So that potential investors (and existing shareholders) are aware of some of the details, Rupert Labrum, Executive Chairman, stated: "I am delighted with the outcome of the Capital Reduction process. The result has changed the retained deficit on the Company's balance sheet of £41m into an £8.5m surplus. The Board looks forward to continuing with its efforts to position the Company as strongly as possible. We are excited by the Company's prospects and believe that its restructured balance sheet will only facilitate our future endeavours."
Like I have said recently, there are reasons why a company will implement a share buy-back and at 7am this morning there were about 145 RNS’s issued and there were 21 RNS’s included in the above, all with share buy-backs.
RKB
PS As always, please do your own research, it could improve your capital wealth.
Hi RKB,
Interesting post - take a look at the RNS 7 Oct
https://www.lse.co.uk/rns/PRIM/capital-reduction-replacement-lc708lhvcty19a5.html
This is why we went to the High Court to get the Capital reduction it allows us to distribute reserves subject to shareholder approval.
As you say it gives the company a couple of options and could reflect what I would perceive a more realistic mcap relative to NAV. Im not aware of how many other small invest Co's on AIM are in this position.
Share Buy-Backs
On the FTSE top 100 companies you often see them announcing share-buybacks. You do not normally see this with AIM companies, why is this?
A share repurchase or buyback is a decision by a company to buy back its own shares in the Market. They do this to boost the value of their stock, and this has the effect of improving the balance sheet.
Companies tend to buy back their shares when they have cash available that they believe will be advantageous to all shareholders to allocate it for this purpose.
Let’s say we have a spare £1 million cash that is not required for purchasing an asset or increasing our stake in a particular investment that we own. If our Company pays us a dividend with this £1 million then our assets will decrease by £1 million. The way the “Market” is currently valuing our Company, our share-price would probably decrease by the dividend amount.
On a share buy-back it is different. “A buyback benefits shareholders by increasing the percentage of ownership held by each investor by reducing the total number of outstanding shares. In the case of a buyback the company is concentrating its shareholder value rather than diluting it.”
So, on a £1 million dividend, each shareholder would receive about £0.00715 (per share) and if you had 100,000 shares then you would receive about £715 as a dividend.
When a company’s Market Capt. is out of alignment with their NAV then there is a possibility that the Board could believe it is better to allocate “spare cash” for a Share Buy-Back.
Rather than paying the above hypothetical £1 million as a dividend, let’s see the effect on applying this £1 million on a share buy-back.
I do not know if a share buy-back would be something that would be implemented by BoD but to me it is a no brainier so I must use a hypothetical share-price for a potential buy-back so that we can compare it with the dividend above.
Ignoring charges, £1 million @ 4p Ask would (could) enable 25 million shares to be purchased. This would mean that the shares in issue would be 114,830,968. Using the closing price on Friday 18th February 2022 of 3.5p (3.5p -3.8p) our Market Capt. was £4,894,083 and my conservative NAV posted at 00:15am last Friday was £10.5 million. This would mean that I had calculated (conservatively) a NAV per share of about 7.5p (£10,500,000 / 139,830,968)
As I have “utilized” above the £1 million “spare cash” for a share buy-back, then my NAV would be £9.5 million which would mean that the new NAV would be about 8.27p (£9,500,000 / 114,830,968) and the Market would have priced our shares at 2.8p if we had paid the dividend (3.5p – 0.0715p)
I believe that to substantially close the discount of our shares to the disclosed assets that we have, can be partially mitigated if a share buy-back program is implemented.
RKB
PS In my posts last week, I have not included the true potential of several assets such as Weshop, Fresho, Engage or Payapps (Zuuse) it is up
Diamond drill program at the Ming Copper-Gold Mine
https://www.lse.co.uk/rns/RMM/diamond-drill-program-at-the-ming-copper-gold-mine-47xeqdsl2te80w0.html
Technically correct that our Directors have Options @ 6p 8p 10p but they have to pay 4.1p for 1 million when the share price is above 6p, also 4.1p for 1 million when share price is above 8p and likewise for the last 1 million when the share price is above 10p.
I have said to many friends that our Primorus Investments Plc is unlike any other company that I know on AIM.
We do not have billions of shares in issue, only 139,830,968 and our Directors only have options over 9 million shares, which are totally aligned with ordinary shareholders because their options do not vest until our share price is above 6p 8p & 10p.
How often do you see an AIM Company focused on ordinary shareholders capital appreciation on their shares?
RKB
PS If you are on twitter, please reach out to me.
RKB, Yes, the £136K was good use of funds.
And from memory our present directors have options at 6p, 8p and 10p.
RL was also buying at around 4.5p last year, so the present 3.6p-3.8p price would appear cheap.
Also I like that there is interaction on the BB's between posters and a director - not common. I'm sure many boards have directors who lurk, and quite likely post but you don't know who they are. Here we know who the poster is and on the "other side" he has replied to a query within about 24 hours.
Somewhat refreshing, and this is a "skin in the game" company, so ticking all the right boxes whilst making interesting investments.
Quite happy with "steady as she goes".
Good Afternoon Skittish
Interesting comment you made earlier about a persistent seller and for about 3 years I used to record the daily trades and used that information to gain an insight into the Company.
We would not be under the radar if potential investors carried out proper research, so I will share something with you that was available for all to see but has not been placed on our B.B.
When our new BoD took over in late 2020, they issued their first RNS on 23/11/20 with details of the “Cancellation of Options”
The Previous BoD had options over 17.3 million shares. 16.8 million @ 6p and 0.5 million @ 8p. Exercise dates went up to 2025.
All the options were bought out by the new Board. Total compensation paid was £135,625.
If throughout the following years all options were exercised, then apart from the Company receiving the funds, our previous BoD would have (at today’s current shares in issue) 11.01% of our company (again excluding any shares they had when they “resigned”) Note there would be 157,130,968 shares in issue (139,830,968 + 17,300,000)
We know from the TR1 issued by AC on 30/11/20 that he had 4,750,000 shares but he indicated he was below 3%. If AC had retained all his 4,750,000 then the above 11.01% would become 14.03%.
So, all we know is that AC has/had less than 3% which could be 1 less than 3% or 4,194,928 (4,194,929-1) he could have only 1 share as that is less than 3% but at the time it was between 1 and 4,194,928.
For Clarity, in the above percentage calculations I have not included the last disclosed shareholding of Ex Director J Taylor-Firth of 1,075,000 (TR1 11/03/20) and Ex Director D Strang whom I believed had 600,000.
Conclusion, I believe that by cancelling the previous Board’s options, we remove a thorn in our side as they would have a percentage shareholding that could impede our new Board. Also, as the Market re-evaluates our Company, I believe our share-price will be closely aligned with our assets and will re-rate accordingly and if I am correct then it will have been advantages to LTH that the previous Board’s options will not be exercised as it would dilute us all.
Also, if our new Board decide or can implement a dividend payment then there will be more to go around to LTH and new shareholders as there will not be (from the above) 17.3 million potential option shares that would receive a dividend payment.
RKB
Here's the link.
https://www.reuters.com/business/london-stock-exchange-proposes-special-listings-private-companies-wsj-2022-01-15/
Talking about unquoted investments, agood development for such companies and another alternative to the JP Jenkins market.
to you RKB. On reviewing the last accounts the company seems to have a very small free float. I got in at 3.2p but didn't buy enough, sadly. Rarely average up but might do here. Be interesting to see how they exit the unquoted and illiquid investments when it happens. I shall monitor the situation regularly.
The disconnect between the share price and value of assets is surprising.
However I get the impression that there remains a persistent seller (as always), and the shares is somewhat under the radar.
The seller could be selling for any number of reasons, not related to whether this is a worthwhile investment or not.
Last year any selling was mopped up by RL buying in quantity, not so now.
I think a reasonable catalyst would be payment of a dividend, but I'm not advocating for that anytime in the near future.
The investing policy appears rather successful, so I'll just leave them to it.
The previous directors also appeared to be quite successful at investing, their problem (or rather the problem for their shareholders) was they sought to take out much of the profits for themselves either via salary or expenses. Fortunately they left themselves vulnerable.
Maybe AE will get this on the radar for new investors, but I'm not holding my breath. This is slow burn, but the value will out in the end, so I'll keep nibbling until then.
We will all know when it does arrive on the radar, but for now I'm quite happy to be able to invest at these prices.
Add another £2 million
Good morning Silvernight.
I agree with you that all the other investments that I did not place a price on comes to £2 million. In fact, I calculated it as £2,026,319 from either a listed price or the original cost.
When you add this £2 million to the sub total in my “Additional Post” of £8,478,853 then this comes to about £10.5 million.
You ask the question “what will be the catalyst to reduce the gaping discount to NAV? and my answer is our BoD.
On all the communication put out through RNS’s our BoD have clearly stated their goals. One goal I recall from memory was to have a Market Capt of £25 million. Other goals are to pay loyal shareholders a dividend and keep costs low.
On the Interim Report, if you were to read it closely you will note that there is a subliminal message on the “Outlook Statement”
http://irservices.netbuilder.com/ir/primorous/newsArticle.php?ST=PRIM&id=311428211825122480
I do not think I would be able to recreate this subliminal message in the same format so I will do it my way.
Outlook
The
Board
Remains
Confident
That
Significant
Opportunities
Exist
For
The
Company
Going
Forward
We look forward to the remainder of 2021 being a period in which we can further demonstrate our business model which is now underpinned by the new investing policy.
The Board are currently reviewing several exciting investment opportunities that are aligned with the new investing policy. The Board has been screening several opportunities and has identified at least one that could begin to generate value for shareholders this calendar year.
We look forward to updating shareholders as and when our existing investments mature, and new investments present themselves.
The Directors would like to take this opportunity to thank our shareholders, staff and consultants for their continued support.
RKB
PS I reiterate, it does make you wonder, if anyone who is selling actually understands how undervalued our company is.
Agree. The residuals would appear to be worth around £2mill but what will be the catalyst to reduce the gaping discount to NAV?
Additional Information.
After I talked to Rupert, I realized that I missed out our additional purchase of 262,358 shares in Rambler Metals which has the effect of reducing our cash balance by about £69,525 and still using Thursday’s bid price of 29.7p equates to an increase in our assets by another £8,395.
Engage Investment. Currently we own 92,374 shares and the most recent price is £22, which means this one investment is worth £2,032,228.
Fresho Investment. After recent capital raise this one investment is worth about £1.6 million.
Payapps Investment (formerly Zuuse) Currently we own I believe 3,057,025 shares worth A$0.86 which means this investment is worth £2,629,196.
Mini Summary:
Engage: £2,032,228
Fresho: £1,600,000
Payapps: £2,629,196
Rambler Metals: £404,912
Clean Power Hydrogen: £1,288,889
Cash Estimate: £523,628
Sub total: £8,478,853
Note: RMM Bid 31p CPH2 Bid 58p
I have not included our Mustang Energy Investment that is ring-fenced or the following;
SOA Energy, Nomad Energy, Sport:80, Truspine, Weshop, Stream TV, Supernatural Foods, Mevie or Rogue Baron.
Conclusion: I believe we have assets worth in excess of £10 million.
RKB
PS It does make you wonder, if anyone who is selling actually understands how undervalued our company is.
Thanks, RKB, and this is just the improvement attributable to the current BoD.
It doesn't take into account that the remaining GGP stake was sold at a higher price than it is now and the increase in the Fresho investment due to their recent raise at a higher share price.
Thank you RKB. Funnily enough I was looking at the investments on the company website yesterday to try and get an up to date picture. Rather opaque as so many are unquoted or non sterling denominated. What about Engage Tech? This had a value of around £1.7mill and the biggest individual investment. Current value? Last year the full results didn't appear until June so we have a while to wait yet.
BoD Actions Increase Assets to £9.8 Millon
Our share price is grossly undervalued in my opinion.
If you were to look at our Interim Report to 30th June 2021 you will not find it on LSE South East (I wonder why?)
You can locate our Interims on our website (which also details our Investments)
https://primorusinvestments.com/news/
For this Post I am not altering the value of any of our existing Investments unless there has been an action by our New BoD since the Interim Results (RNS issued 10/09/21)
From our Interim Results, we had cash in hand of £1,346,000 and Total Assets £9,170,00.
RNS 15/09/21 Zuuse Options Exercised. We paid cash of £265,000 to acquire an additional 1 million shares and using the last price we paid of A$0.86 this equates to an increase on our assets of about £190,476. This is only the new 1 million shares. (Rate 1.89 conversion)
RNS 21/1021 Alteration Earth, our £100,000 & £250,000 intended investment has not occurred just yet.
RNS 17/11/21 Weshop update, I am unable to calculate what impact this has on our assets, but this is a noncash transaction.
RNS 19/01/22 Mustang Update. We sold on part of this investment and received $1 million of our investment back along with an interest payment of $72,054 this resulted in our cash balance increasing by about £788,762 and our assets increasing by £53,013 (the interest payment, Rate 0.74 conversion)
RNS 3/02/22 Rambler Metals Investment. Paid cash of £276,609 for 1,043,810 shares at £0.265 and at close yesterday the bid was £0.297. This is an increase on our assets of about £33,403.
RNS 16/02/22 Clean Power Hydrogen CPH2 Investment. Paid cash of £1 million for 2,222,222 shares at £0.45 and at close yesterday the bid was £0.61. This is an increase on our assets of about £355,556.
I calculate from the above our total assets are about £9,802,447 which includes cash of about £593,153.
I have not made allowance for Salaries or admin expenses in the £593,153. Technically we have more actual cash as some of it is ringfenced for specific investments.
So we have almost £10 million of assets and Market Capt of about £4.894 million.
RKB
And the Fresho investment showing a gain of 55% in 11 months based on the latest fundraise.
Extraordinary that these should be so lowly rated.
No doubt value will out in the end.
Positive update, Prim continues to be under the radar. CPH2 is already £0.66, that's a £466,000 gain on the IPO investment.
https://youtu.be/yKeVlfkIgQ4
RMM looks like a great investment and in a safe jurisdiction.
Looks like a great small term investment already up almost 17% on the placement price.
Thanks Rupert, positive to hear. The sp really needs a good catalyst to get to the next level. Here is the direct link to SP Angel if anyone wants to view the report: https://www.spangel.co.uk/research/#/portal/sp-angel
Rupert - will the next comprehensive report for Prim be the Annual Report in June? Or will we be getting some form of quarterly or half-year overview too?
Rambler Metals & Mining* (RMM LN) – 28.25p, Mkt cap £45m – Ming Mine turnaround gathers pace
We have published an updated research note on Rambler Metals & Mining. Please CLICK FOR PDF
NPV Valuation: 168p/s
An accelerating programme of underground development is delivering improvements in tonnages processed, grades, recovery rates and copper production at the Ming mine in Newfoundland.
The recent discovery of a new mineralised zone near existing underground infrastructure east of the main Lower Footwall Zone highlights the mine’s underexplored character.
Despite relatively low levels of past exploration, the mine has an established history of resource replenishment exceeding mining depletion with recent drilling showing both grades and mineralised widths improving at depth providing a long mine life with expansion potential.
As drilling ramps up and development accelerates, the turnaround of the Ming mine is now gathering momentum with copper output expected to double the 2021 levels in 2022.
Rambler Metals operates in an established mining jurisdiction rated among the 10 most attractive places for mining investment globally.
Based on SP Angel’s long term commodity price forecast of US$10,500/t copper, we estimate an NPV6% of US$362m or 168p/share.