RE: TGR - significant ex-China Graphite producer26 Jun 2023 16:28
#TGR
Tirupati graphite
Market Cap £38m
Mine in Madagascar & future projects in Mozambique.
Producing miner ramping up production with update due in one weeks time. Expecting numbers to show output up 600% from last year (FY runs april-march). Increased resource from 1million ton graphite to 14million through an acquisition completed April.
Almost debt free and now profitable with projected £10m net profit this current FY. Under 25% shares held by the public. No risk of dilution. Share price only up 5% since start of year.
Producing 30ktpa of premium (large flake) 97% graphite, makes them second largest producer outside China. Lean and green operation possibly lowest CO2/t, lowest Opex and Capex of peers.
They design and install all their own equipment.
The weighted average basket price by flake size of their product is $1850/t (2022 prices) but they are selling for $950/t so likely undercutting the market or selling cheaply to customers until the product is fully qualified/garanteed so there is resilience and possible future upside.
Possibly the lowest carbon footprint of peers due to pre-consentrate units at mine face using hydro power to slurry pumping ore to the final processing plant saving haulage diesel. Beyond this, they can upgrade 3% grade ore to 97% product at $300/t when peers spend 400-600/t processing 10% Ore. The geology is soft clay and sand so no blasting required. Really excited to see what they can achieve at the newly acquired assets in Mozambique which is much higher grade. One location is fully permitted and 50% constructed so could be finished quickly and for between $20-40m Capex.
Plans in place to increase production from 30ktpa to 84ktpa by end of 2024. Targeting 8% of world flake graphite production by 2030 (400ktpa)
http://www.aimchaos.files.wordpress.com/2023/04/tirupati-graphite-valuation-analysis-05.04.2023-5.pdf
https://twitter.com/AndrewMathieso3/status/1669343357305491460?t=_l7iLTxz5LOk8gN4nSBV4Q&s=19
The downside, they missed production targets previously due to weather & supply chain delays. They went offline to future proof operation against weather events so now more resiliant.
Also an Indian company so have tended to build themselves instead of going down the PFS/DFS/BFS route, but on the upside, admin costs are very low and they can bring a mine online in a fraction of the time. Some people don't like the PR but the numbers are about to speak for themselves
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