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Absolutely - A1 and A2 were always aimed at stainless steel production. Vermelho has options for either HPAL / battery market or more stainless via RKEF.
Either way though, I think that increasing nickel demand for batteries will have some knock effect on the price of class 2 nickel, so battery stories aren't entirely irrelevant - especially if a better way of upgrading NPI/FeNi to nickel matte can be found.
Hi TDT - not a major point, but just a clarification on the Araguaia product. HZM have stated that they will be producing FeNi30, which as the name suggests is about 30% nickel. Nickel Pig Iron on the other hand is typically in the rage of 4-10% Ni, so a very different product.
I know that there has been some talk from China about processing NPI into class 1 nickel, but I suspect that this is both energy intensive and not very environmentally friendly.
My view is that it depends on the reason for the consolidation. I have seen a company effectively forced into a share consolidation following a "fire sale" fundraising round where it was even debatable whether the company survived - that one carried on down (back into sub £1 territory).
With HZM the dilution in the fund raise was higher than many would have liked - but the fund raise was to pay for the project getting built, rather than just hemorrhaging money to survive.
20:1 does seem quite extreme though - I wonder if this was picked to ensure that the sp remains above £1 even if there are problems along the way. At the current so, after consolidation the price should be around £1.50, which gives a but if a buffer against any (hopefully temporary) declines.
20:1 consolidation proposed - so that should increase the price per share ;-)
(Obviously should have no impact on the value of your holding, but getting us out of the penny share range might encourage more ii's to take a position)
This is copies and pasted from the BMO presentation (page 24). I think that it gives some idea of value - not all of them are the house broker!
Analyst Coverage
BMO, Alex Pearce Outperform, £0.13
Peel Hunt, Tim Huff Buy, £0.14
Paradigm, Geoff Woolley Buy, C$0.50
Cantor Fitzgerald, Matt O’Keefe Buy, $0.21 / C$0.35
Cormark, Stefan Ioannou Buy, C$0.70
Just for a laugh, I had a look at what the revenue could be for 54000 t/a (A1, A2 and V in production) at $32000 / ton - taking off $12k for production costs.
This leads to an earnings per share of just over 20p (for 3.8bn share and $1.35 to the £).
Obviously not all of that would go to shareholders - there are debts, royalties etc., but this could still support a reasonable dividend.
@strummer I can understand why you have chosen to filter a couple of individual posters on this board. Personally, I have chosen not to, as I kind of like the balance! My baseline assumption is that everyone is entitled to their own point of view, and these boards allow people to express it. I am perfectly entitled to ignore them though, whether through automated filtering or using my onboard meat computer!
Even amid some of the extremes there have been some interesting nuggets - and as I mentioned earlier, these posters have spurred me on to do more research of my own.
My view since 2017 has always been that the value of the commodity in the ground was not in doubt - although whether HZM would exist independently long enough to extract it was. I am aware that the financing package was not to everyone's liking - but ultimately that value will only be realised if someone extracts the resource and sells it for money! So maybe the deal was necessary in order to make that happen - none of us were present in the negotiations and so we don't know what the pressures and trade-offs were.
Even with close to 4 billion shares, even A1 makes a reasonably decent return for me, based on my average. Assuming A2 gets built the numbers start to look really good, and that is still not ascribing any value to Vermelho or Serra do Tapa.
I am comfortable with my holding (although a higher % of my portfolio than would be deemed prudent by risk management), and there is a distinct possibility of life-changing levels of return for me.
My opinion, and I alone am responsible for my investment choices. I would never attempt to blame or credit anyone else for my losses or gains.
Good luck to all holders - it does feel like we are at the start of a journey to realising the value, and at the start of the upward curve of the Lassonde chart.
I have been here since late 2017, and still holding. I have to disagree with the comment that contrarian123 (or anyone else) has cost anyone any money. The only person who can cost you money is yourself.
I read quite a lot of the comments on this board - some I agree with, some I don't (but often they spur me to do more research myself). I remain responsible for all my trading decisions, whether or not any of the comments here have influenced my decisions.
Personally, I still believe that HZM have a long way to go in realising their full potential, and I am in for the long term - whether to production / dividends or a buyout only time will tell - although my hope is for the former, I have no influence on what others will do!
That has to be one of the poorest articles on HZM I have read in a long while. The 'journalist" appears to be completely ignorant of the facts that a) HZM has done a full feasibility study proving the value and mineability if the resource; b) the funding for construction was completed some time ago and c) we already have a 100% offtake partner for the first 10 years in the form of Glencore.
Strikes me as very lazy writing and research!
Presumably having three top tier strategic investors holding over 40% reduces the probability of a takeover.
I see this as a sign that HZM may well still exist as an entity in 2 years time when production is starting.
Not sure who the buyer would be, but I think that La Mancha are prevented by the terms of the fundraise from going above 20% for a certain period of months - not sure how many without looking it up.
> is this of interest? no... they will start builing soon...thats enough to know ;)
Probably not - but I just got a bit interested in seeing exactly whereabouts "our" Araguaia was, and then fell into the internet rabbit hole! Just passing the time until we get a "ground breaking" RNS!
https://www.metoffice.gov.uk/weather/forecast/6yscnd0ur#?date=2022-04-06
Looks hot and humid - with a bit of rain - over the next week or so - 33 degrees and up to 95% humidity at times!
(This is for conceição do araguaia - close to the Araguaia South site).