Member Info for HarChris

Yeah I'm invested in Avacta K, would be shocked but by now I'm immune! For those new to small caps AIM is not always like this, in fact when I started dabbling in AIM shares in 2020 it couldn't have been more different. Any company, and I mean any, with a hint of good news saw share price gains - breathtaking news (re FSS contract) and a 1000% rise was easily possible. I've seen smaller contract do 1500%.

I could name 30 AIM companies that operationally speaking have never been stronger yet are 70%+ off their highs from 2020/2021 and still, even with very beaten up share prices, good news is sold into currently every.single.time.

It's tough out there guys!

No it wouldn't, the share price has risen from 6p before the FSS contract became a reality to what is now 17p - all of us here believe HARL should be valued higher as it is but it takes a bit of time to convince the market, especially as the really big jump in revenues is a year or so down the road as we trade in a market that can't see past its nose.

6p to 17p is nearly 200% rise, if we see that again in the next six months to 51p I think most of us will be happy.

But before we worry about that let's see BMN's valuation catch up with their operational size now. Assuming V stays where it is through 2023, a quarter of the stockpile is sold and BMN borrow $10m from the 'specialist funder' I have them ending 2023 with short term debt eliminated, long term debt decreasing to $48m and NAV increasing to ~$177m.

As a profit making business with debt reducing and $177m NAV I'd expect to see many returns from 5p at which point the company will be well placed to start thinking about the next stage of expansion.

A lot Lindon but Mokopane only comes into play if the demand for vanadium follows the sort of trajectory Guidehouse has forecast (150000tpa for vrfbs alone by 2030!) and given that scenario vanadium price is only going to strengthen further from here (say $55/kg - $60/kg) making BMN a 5100mtV producer hitting $150m+ gross profit per year.

If the above plays out it won't be hard to raise money in the years ahead although much of it could be self-funded.

Prior to this turn in the markets and high inflation/increased interest rate environment it was already going to cost any new producer hundreds of millions of dollars + many years to reach anything like Bushveld's production, what chance do new entrants have now?

As I said it's not crystal clear how the £65m is broken down, perhaps it isn't negligible, it's me that assumed it from the wording.

Either way what it does clearly state is that only £12m of the £77m is coming out of Harl's pockets via new asset financing and that doesn't include the technology and skills transfer from Navantia either.

It is not crystal clear in the note Avyererdowt but the breakdown according to Cenkos is this:

£77m total investment into the shipyards at Appledore and Belfast broken down into roughly
£45m - MOD & Navantia
£32m - £20m government grants (levelling up & new technology grants), £12m from Harland and Wolff

There's also a mention of contributions from the landlords at Belfast but this is assumed to be negligible.

As has been discussed already it’s rather likely John is just playing it safe this time and looking to overshoot forecasts rather than miss again - plus they already have ~£140m secured from 2025 onwards so a steep jump in revenues is more or less guaranteed in the years ahead.

I was preparing a post about this, only spotted it when rereading the broker note - massive news.

Completely agree with many of the comments on here re conservative targets, I would not be surprised if we see an upgrade in revenue guidance alongside the full audited results to turn what could have been seen as a negative into a positive.

For those well versed in the company it doesn't offer anything particularly new but they have given us a big fat BUY.

I'll share some of the broker note details later, or if anyone particularly wants it I'll send it to them.

The wait for a constructive post from you that isn’t a personal dig at someone goes on… I personally doubt you’re capable of producing one.

I agree with this tweet: https://twitter.com/shirkerism/status/1630587277272403973?s=46&t=COdTBmeWCdxhSV6mHyFLow

After all the chaos in the conservative party over the past few years it would be highly surprising if Sunak is not contesting the next general election - but yeah most likely will be Starmer in charge from mid-late 2024 onwards.

Yeah he's my wife's lover.

Ps pleased to see you adding to the debate as ever.

Personally I see V pushing north from here with the vrfb growth we're seeing, increasing the numbers below significantly higher.

At this stage one doesn't have to have a huge amount of faith in BMN management for this to be an amazing entry point, one simply has to believe that vanadium demand/supply dynamics are in Bushy's favour. As I pointed out in the post with many recommendations BMN survived the six months from July to December with just $7m with V in Europe well below breakeven point and many other factors up against them whilst (which I forgot to include in that post) producing an extra 261mtV than they sold. Even throughout that time the share price only very briefly went below what it is now.

Do you agree that if the price of vanadium at least stays where it is (~$43/kg average across our weighted geographies not including premium products) and the dollar holds up against the Rand (bringing breakeven down to about $33/kg) that Bushveld with a gross profit of $44m in 2023 + an extra $11m for each 250mtV of the 1087mtV inventory they have won't be where it is today, share price-wise?

And it's for that very reason that most will miss out now, because they think they've heard it all before and history is simply repeating itself when in reality the history that looks like it may well repeat itself is the one from February 2018, that time being 8p to 48p.

As is true for most commodities we always see an inverse correlation between vanadium price and the dollar. The last time the dollar was this strong was in April 2020 and European FeV was $26/kg with Chinese FeV at $27/kg. Now it’s $40.25/kg & $45/kg respectively.

We have never seen positive correlation between the dollar and vanadium prices like this before...