Member Info for ShearClass

The 1.5m published yesterday was likely a sell & the reason we remain in the 7-8p range. It'll be related to the recent placings & someone bagging a 40-50% profit on some of their shares. The 390k trade late in the day today at 7.5p looks like a buy though, as the bid for size has been around 7.2p all week.

Nevertheless, things definitely hotting up here, I fancy we'll get a very nice Santa run this year as investors speculate on the release of the claim value.

Same here, guidance was increased and it actually opened up and the first trade was a buy at £1.226. Never ceases to amaze me that an LSE listed stock valued at £1.2b can fall 15% on £300k worth of volume. Wouldn't be surprised if shares finished up as most of the volume lands during the afternoon, clearly from US based buyers.

"370k shares at 8.4p is properly punchy… clearly a buy, so wonder why that didn’t boost the sp…."

Suspect it was a worked sell - offsetting the early buys at 8.8p and then reported late to try and get some more buyers in? Always smoke and mirrors with this one!

Yep, it took GreenX around 9 months from commencement of the arbitration to file the claim size, highly likely the number will now land in 2025 and as others said it's critical they get the methodology absolutely watertight. Worth looking back at the RNS filed by Prairie Mining Ltd (now GreenX) on 9th June 2021 to get an idea of what to expect

In the meantime the two parties need to agree on which legal framework the arbitration will be prosecuted under, my bet would be UNCITRAL, a la GreenX, as both India and Poland aren't ISCID members.

Gallmat, once again you confuse me. Friday evening saying you expect the PAT share price to drift post their key submission of the NOA & then this morning cross promoting Mkango.

Are you a stooge?

Mkango's agreement means nothing in the context of them needing to find $277m in pre production CAPEX for a rare earth project with mediocre economics. Good luck investing in that

yeah it's in the 28th feb 2023 rns, it increases to a maximum of the higher of 15% of the award / 4.25x the multiple of invested capital if not settled in the first 4 years from aug 2023. no data for fasken, but it'll be nothing vs lcm as they aren't risking $13.7m cash.

@prof do you have the link to the jv discussions?

this is the tethyan copper case; https://www.iisd.org/itn/en/2019/12/17/tribunal-finds-****stan-breached-fet-expropriation-non-impairment-obligations-mining-joint-venture-with-australian-investor-tethyan-copper-company-tethyan-copper-company-v-****stan-icsid-arb-12-1/

And yes, I expect shares to be trading north of 10p on Monday, there has been a complete lack of volume in PAT this year. The last day with >4m shares traded (~£300-400k worth) was when the LCM financing was confirmed last August, back then there were 3 consecutive days with over 3m traded (10.6m shares in total), shares traded over 10p back then, and my view is that it's simply a lack of volume which has allowed the MM's to keep shares surpressed

Friday afternoon saw just over 1.2m traded and we were up 31%, there is clear reason to want to buy shares in PAT now that the claim is in, and the market cap should be worth materially more than it was last summer IMO.

Shares traded up over 10p last A

The expropriation date for Bhukia was almost certainly the date when the mining law was formally changed in March 2021, however it's vital to understand that mining auctions only started with the 2015 law change and PAT applied for their prospecting license in ~2008! They were supposed to be exempt from the 2015 mining law & auction process, however any exemption was removed with the 2021 change. This is a useful article I posted a few weeks ago on that subject;

https://m.economictimes.com/industry/indl-goods/svs/metals-mining/removal-of-certain-section-of-mining-act-may-lead-to-irreparable-loss-of-investors-confidence-fimi/amp_articleshow/80431869.cms

The introduction of the auction process in 2015 & frankly ridiculous auction premiums which have been paid since will surely be a major problem for whoever is representing Indian / Rajasthan;

There appears to be clear motive for not issuing prospecting / mining licenses in the years before the 2015 law change as these licenses wouldn't have needed to pay any auction premium, so the government would have missed out on 65% of Bhukia's revenues, and these would have instead flowed through to foreign shareholders.

Unless there is something material that LCM & Fasken have missed, then the defendants appear to be in a near impossible position.

@Artoha, nope the auction premium has no relevance to the claim value as far as I understand things.

Article 7 of the the BIT treaty specifically states "The compensation referred to in paragraph 1 of this Article shall be computed on the basis of the market value of the investment immediately before the expropriation

or impending expropriation became public knowledge."

https://investmentpolicy.unctad.org/international-investment-agreements/treaty-files/154/download

This effectively prevents the government deliberately impairing an assets value via any type of PR stunt. Now, they could potentially try to argue that the expropriation only formally happened when the auction concluded, but to me that would seem a crazy move given the implications of the 2021 law change were clear cut. It's possible that LCM / Fasken wanted to let India their hand so that they can't try to claim that PAT still have ownership of the asset etc.

Never thought it would happen - no turning back now!

Things officially just got very interesting with the 1.4m buy at £1.10, is Mr Blundy hoovering up more shares?!

"hence for Yu to have achieved 60% growth in H1 is astonishing"

Nope. The vast majority of revenue recognised in H1 24 will have been contracted in late 2022 and 2023, it's the decline in monthly bookings which is linked to lower commodity prices.

The move over the past couple of days is the market attempting to make sense of what the lower bookings number means for FY25 & 26 revenues, considering the growth in meter points it was a surprisingly large fall.

Market makers always hold shares at technical resistance for a little bit to take shares from profit takers, based on the late TR1 I'd say it's likely shares break out in the next couple of days, very unusual to see a foreign billionaire take a material stake in a UK small cap. Then again, there aren't any other listed retail growth stories trading on a forward PE of 7.5!

@ejt, agree with a lot of your post, however after re-watching the VSA capital call from early June I am concerned about whether they still have 'dreams' of gaining the Bhukia license, in spite of everything that has happened with the auction.

Remember that the chairman has been waiting for this since 2008, if they submit the NOA then they know there is almost zero chance of getting the license. On the other hand, they may believe they can use the NOA as a bargaining chip to create a miraculous turn of events.

Ultimately, I suspect the chairman and second largest shareholder has the final say on if/when the NOA is filed. Nothing else explains the lack of action now in my opinion.

The story is that they have been selling for over a year, down from a peak of 68m in May 2023, total share volume in that time has been ~292m, so Telios selling has accounted for approximately 1 in every 4 shares traded. That's a huge headwind for a small cap stock.

The history is that they took around 38m shares from Woodford when his fund imploded in late 2018, paying around £1.80 / £68m. Covid then hit and they got hammered. They averaged down at around 35p, near doubling their holding and reducing their average price to around £1-1.15.

They then waited for shares to return to this level before offloading, which was after the FY23 final results issued on 3/5/23, when shares hit £1.14. The P/E ratio at that time was ~9.5x

Fast forward 15 months and they are finally clear, despite CARD performing ahead of expectations the constant selling at the same price point has surpressed the PE down to just 7x. This compares to around 12x when they bought the Woodford stake in 2018

I suspect the fund manager was instructed to exit the position at breakeven, which was fairly unimaginable for most of 2020.

A break of £1.12p in the next few days opens up a re-rate to around £1.50 in my view, there is no logical reason for CARD to trade at less than 10x earnings, especially with a decent dividend yield. With a 7 broker consensus target of £1.57 that would be well supported...

Affrm, if you had seen the L2 order book in this mornings opening auction you wouldn't think this should be up

There were 6x 1m sell orders posted from 10.5 - 10.9p, there have been periodic spoof sell orders all week which have given away the presence of a large seller / manipulator, however this morning the message was clear - this shall not pass 10.5p and break out...

My view is that it needs to fill the gap at 8.8p and until then it will be forced down. Beyond that who knows, however there appears to be very little serious buying interest now

"if the last 2 years are anything to go by this will creep back down again( god I hope not lol)"

Having watched from the sidelines over that period, my impression was that the initial drop from the 30-40p range was caused by the initial PFS released on 20/04/22 which quoted a pre production capital requirement of $2.7b.

This drop was accelerated by the falling commodity prices through 2022, as copper & gold both fell below the base case assumptions, making financing less and less likely.

Then, in the second half of FY23, the cash position + a lack of progress was seized upon by shorters who likely saw an opportunity to try and seize the Cascabel asset from SOLG. This came to a head in Feb / March with lows in the 5p range, however it was reversed by the publication of an updated PFS with a much lower CAPEX requirement + the CIPA agreement.

More recently shares have hovered between 8-10p, with the exploitation agreement not quite being sufficient to get shares through 10p (and in fairness I was dubious about buying in due to the funding uncertainty).

Monday's agreement represents the forth positive kick in the 5 months, and is by far the most material as it underpins the PFS NAV & provides half of the pre production CAPEX, as well as removing funding concerns.

So in summary I see the following;

1. Company published an initially overly optimistic PFS, then got hit by the copper bear market, then was crushed by shorts looking to take advantage of a liquidity squeeze

2. The company has escaped by amending the PFS to make it more realistic, has made huge strategic progress with the Ecuadorian gov't & then underlined this with the streaming deal.

At 10p, shares are trading at 25% of their value in early 2022, despite the above progress & copper prices returning to ATH's.

This valuation gap will not correct overnight, but rather over the next 12-18 months. In essence, had the recent events taken place in 2023 rather than 2024 the share price would never have been pushed down to single digits IMO.

The only question anyone cares about is why has the NoA filing not taken place yet. And the answer needs to be in an RNS, not via potential disclosure of price sensitive information to retail investors on a call / email.

And @gallmat, the wait has been interminable. Remember the CEO said last September that a 2024 timetable for the arbitration would be shared with shareholders imminently. 11 months on we are none the wiser

I can't be the only one here who is stating to get a bit shaky.

The lack of transparency around Bhukia is becoming disgraceful. On 2nd Jan they said the NoA would be submitted by the end of the Q1 2024. To date they haven't updated on that timeline, despite missing it by a substantial margin.

The second red flag is the Kalaka drilling. I mean what on earth does this mean;

"The Company continues to advance its discussions regarding the potential restructuring of its interest in its West African gold assets. If successful, it is anticipated that this will not only provide a path for the Company to realise significant value from its West African gold portfolio, but also provide funding for both the current Drilling Programme and advancing these assets going forward."

So they would get some cash which they would then put back into the same assets?! WTF. Why do this & what happened to minimizing dilution?

And why would they go to such lengths if Bhukia was on track?

Its a riddle, wrapped in a mystery, inside an enigma and the market won't accept it continuing for much longer