Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
https://apple.news/AQQFFfZmbTiW5OzQOsyqEPQ Russian Aluminium and Nickel
Nickel can rise to $45000 per tonne, Europe& USA is top consumer of Nickel. Contrary to Oil&Gas, if Russian Nickel is banned, Russia will have difficulty in finding customers because India the top Russian oil buyers doesn’t consume much Nickel. This is also the major reason Elon Musk rushed to Indonesia & invested $5 Billion.
As USD is strong, GBP is weak and HZM undervalued. There is currency favourable for dollar denominated investors miners/producers to lock the advantage. It also makes HZM a good target for T/O. In theory, HZM should re-rate on weak pound and strong dollar and Nickel spot still 35% up from average price and forecasts way higher.
It’s bit complicated but interesting . SP retraced at price around old 9p(1.85£) , When heavyweight Glencore took 10% stake in shares on average £1.3. This £1.85 is the same La Mancha bonds conversion price. If Bonds are converted, Glencore will be forced to pay high price between 200-400p if they want to further increase their stake, Currency is very favourable to La Mancha. Sentiment will be all time high. Market capitalisation will be £800 to £1600m, if Nickel again goes bonker then £2000m also possible.
Nickel price was below $18000 per tonne when this funding was secured, terms can be re reached, above all, to buck the healthy nickel price, it seems in the best interest of HZM and bonds holder to convert them. IMO, BODs already seems to be on this course of action.
Russia has reduced Gas supply to Paris, EU is the top consumer of Russian 15% Class 1 Nickel which is the driver of surge in Nickel Price. This is the most interesting factor to keep eye on. La La La Mancha, if converts the Bonds will do a quick buck to shareholders, does anyone has email adress
Indonesia, Russia and Philippines are top 3 producers, reserves is something else. Russia produces 15% Class11 World Nickel supply. Class 1 Nickel is driving the Nickel price high. Europ is top consumer of Russian Nickel.
Ok, Why Elon Musk/Tesla landed in Indonesia with $5Billion investment but not Australia ? Possibly, Australia lagged focus on battery metals and are little late. Slum, English is my secondary language
Wasaruner, when capital expenditure is done on underlying assets/metals , their assets value goes up, probably that’s how ROCE jumps massively . Co A, spends$100m on exploration, and finds worth $40 billion metal. Co B , spends $500m, and makes This metal come to market
ROCE (ROCE) will jump to 3000 to 7000% in this annual result or it can significantly lower from
This range, but definitely way higher,
So re-rate is very likely in the cards. Risk was high for La Mancha when he took the bonds but now Glencore on board, it’s nominal
Since the loans agreedfrom banks and equity funding, market has improved significantly. IMO, BODs will come to same lines thinking aloud. La Mancha also has opportunity for quick buck. Definitely, he would prefer his investment to to up to 240m, rather than 100m now.
If La Mancha converts bonds now, market rush to fill the gap to £1.8 because financial risk will diminish significantly. SP will be up and Glencore be forced to pay premium at 400p or old 14p old price in any future funding. La Mancha holds the key.Credit profile will be massively attractive. HZM will be able to raise $400m at £4 or higher. Project will be massively deriskd
IMO, La Mancha convertible bonds are hindring the SP, which have coversion price around £1.80, though SP has crossed £1.80 in intraday. To take the full advantage of high Nickel price, Bond coversion will open the path for equity funding. Market valuation will be way high. Credit profile will also jump. Cheap take over will also be avoided.