Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Interesting that there have been no trades for 45 minutes as we enter the last hour of trading. Despite coming off earlier highs above 10p we are still Up 25% at 9.25p on volume of 6.25 million and Number 2 on the Leaderboard. Will we have another go at 10p before the close.
Searcher
If you want to get more in your ISA , sell one of your current ISA holdings and buy that back with your new ISA money. It’s probably unlikely any of your other ISA stocks have such good upside potential in the next 10 days as GCM.
The Charles Archer interview is well worth 30 minutes of your time. They conclude that JLP has reached an inflection point. The rapid growth on all fronts is going to be reflected in the financials. As a long term holder of JLP I am convinced 2024 will prove to be a transformational year for JLP as copper kicks in to follow the success of Chrome which continues to grow at pace and is very profitable.
Continued:
Shanta Gold’s 2023 results are due on Thursday (March 28) and the shareholder vote on the deal takes place the week after, on Thursday, April 4.
Questor says: Gold miners could be primed to shine."
Shanta Gold
Whether a 10pc increase in the offer price from bidder and global conglomerate ETC Holdings (Mar 19) is enough to sway shareholders in Shanta Gold (SHG:AIM) remains to be seen.
If the deal does go through at 14.85p a share, with a dividend of 0.15p a share on top, we will bag a total return in excess of 50pc (Questor, Jan 10, 2023).
Given this column’s dismal record with junior miners, would be more than enough to keep us happy. That said, we can see why some shareholders may feel that even the higher bid represents a bit of a low-ball price.
It equates to a market value of £156m for a firm whose net assets are £133m , according to the last set of published results.
They were the first-half figures for 2023 that were released back in September.
That price tag implies a price-to-book, or price-to-net-asset-value, multiple of 1.17 times.
However, Newmont’s (NEM:NYSE) bid for Australia’s Newcrest in 2023 valued its target at 1.7 times and there is a good possibility of Shanta Gold growing its book value in future, should retained earnings flourish as expected, thanks to both increased output from its New Luika and Singida mines in Tanzania and an all-in sustained cost (AISC) of production of $1,200 (£949.26) to $1,400 an ounce.
With gold trading at $2,175 an ounce, profits should start to pour out of the ground, if all goes to plan, and the metal’s price stays firm.
There are caveats to this. Newcrest is a much more mature and bigger operation than Shanta, with 2.1 million ounces of annual gold output at an AISC of $1,093 at the last count and the stock offered a higher dividend yield than Shanta’s before the acquisition by Newmont.
Investors are also always likely to place a higher multiple on operations in Canada and Australia relative to ones in Africa, for geopolitical reasons, even if Tanzania is one of the most politically stable nations on the continent, in contrast to say Mali or Burkina Faso, where coups in 2021 and 2022 continue to weigh on investor sentiment toward gold diggers such as Resolute Mining (RSG) and Endeavour Mining (EDV).
Intriguingly, EQT’s bid for Shanta is the latest in a growing list of merger and acquisition deals in the gold mining industry. Barrick Gold (BAG:NYSE) swallowed up the then FTSE 100 constituent Randgold Resources in 2019, when Newmont snapped up GoldCorp in 2019.
Agnico-Eagle (AEM:NYSE) and Kirkland Lake Gold merged in 2021 and then in 2023 Agnico-Eagle and Pan American Silver (PAAS:TSX) bought and split up Yamana Gold before Newmont pounced on Newcrest.
The New York Stock Exchange’s Arca Gold Bugs index is trading no higher now than it did in November 2003, when the gold price was $390 an ounce.
Gold mining executives are clearly paying attention to this disconnect, judging by the rash of deals, even if stock markets are not, and we are therefore happy to keep faith in both Egypt-focused Centamin (CEY) and Resolute Mining.
Shanta Gol
On 1st March CNR closed at 20.5p. Since then it has risen steadily to 25.75 close last Friday which equals the previous recent high seen for 3 days just before Christmas. Let’s see if the rise continues this week and move firmly above 25.75.
GCM has for many years been in a binary position. All the work has been done to prove this up as a ready to go high quality coal project. The only issue has been whether Hasina will approve it. We have never before seen such positive comment from Bangladesh that Phulbari is vital to its future and pro mining comments from Hasina and the Power Minister.
GCM have released an RNS whereby Power China have agreed to provide US$ 1 Billion upon scheme approval by the Government.
If the green light is given this project has seen values attached to it of upto US$ 100 Billion against a current Market Cap of circa £22 million. If you believe the green light is likely to be forthcoming the risk/reward proposition would appear to be compelling. The antics of the MM’s this morning are providing an opportunity to buy this under 10p, infact currently under 9p.
RNS this morning announcing more Director buys this time CEO Adam buying 51500 shares taking his holding to 550000 shares.
From advfn:
“ hTTps://www.lusakatimes.com/2024/03/22/mopani-copper-mines/
Mopani Copper Mines, a cornerstone of Zambia’s mining industry, took center stage as President Hakainde Hichilema officially unveiled its new strategic equity partner, International Resources Holding.
President Hakainde Hichilema has officially unveiled International Resources Holding, the new strategic equity partner for Mopani Copper Mines.
Speaking during the unveiling ceremony in Kitwe yesterday, President Hichilema said the occasion marks a significant turnaround for the economy of not only the Copperbelt but the country as a whole.
My apologies for attaching a comment about GCM to a post about CHAR. But as you say the sp’s are very similar and I have been commenting on both shares this week as both have been moving north. I have been invested in both companies for many years and am pleased to see them rising. I do think it is rather immature to refer to any positive comment as pumping.
I do however agree with your comment that on a green light for GCM it will outperform CHAR but that still leaves scope for CHAR to 5 to 10 bag from its current sp if the analysts and commentators are right.
Yesterday there was a 1 million Buy at 9p after the close.
Today there was a 1.17 million Buy at 9p after the close.
It looks as if someone is accumulating in large chunks with the sp being held down to accommodate these large orders.
Hopefully we will get news next week or their will be news in the Bangladesh newspapers over the weekend that will send this above 10p never to return to single pence.
More Director purchases is a positive sign. The Chairman has bought more following his purchase earlier in the week and the CFO has also purchased.
The 1 million trade was shown as a buy on advfn and as it was at full Ask at the highest price paid in the last hour of trading, there is no doubt in my mind that it was a buy. I am expecting a further rise tomorrow that could well see CHAR back above 10p.