RE: Presentation...6 Jun 2021 13:30
Dream scenario PaulFG....we are funded for next stage of drilling I think. Greg was a little hesitant and not 100% clear but if we are fully funded and drilling comes back positive surely we will re-rate from such a low market cap?
Let’s say for arguments sake we are sitting around 7p after drilling for £23m market cap. I’m not convinced it will get there until we have an updated JORC but dream scenario!
Greg hinted the next raise is almost certainly going to be a private placement and not an open offer despite his claims he will get the brokers thoughts on all an open offer.
Let’s say we raise at 5p for a 30% mates rate discount (from 7p) for 20% of market cap raises £4.6m issuing 92m new shares?
Say half of the 2021 warrants/options at 2p are taken up for another £650,000 (32.5m shares).
The only issue with this is doing a raise when the cupboard is bare which is risky but I think they have plenty of backers willing to invest as long as the drilling is favourable.
So....let’s say after dilution we have 428m shares in issue and £5.2m in the bank with a market cap of still £23m, roughly 5p?
£5.2m would certainly allow them to ramp up exploration and drilling.
If (huge IF) the IOCG targets look promising we can forget about RC drilling we will need diamond rigs drilling to depth so drilling costs will increase dramatically. However if there’s a valid reason to continue to investigate the potential of these targets the positivity of the IOCG being worth drilling at depth will add substantial value to the company.
The next raise is key to how quickly the company can progress. If they only raise £1-£2m per year it’s going to be a long hard slog to release value.
As soon as Andromeda need to contribute through the JV that will also give us more funds for exploration.
Sorry for the waffle but that’s my take on funding and going forward, complete speculation in other words!!
Sign In
Follow the stocks
