RE: For Trek DYOR23 Feb 2022 10:30
Hi itsyou,
Thanks for the heads up on this one. I am always a fan of management lock-ins for the first year. IMO this is being held back atm by general market sentiment for smallcaps.
IPO was cheap, had to be as cash is king and they need the money for ops.
1p IPO for 700k Oz’s valued at $25/oz’s, for an explorer and producer in a relatively stable country that is pretty cheap. African small cap producers valuation of $50/oz would be appropriate especially with this postcode. Larger scale producers over $100 per Oz according to our CFO.
As they have cash and warrants to come no reason why these can’t get to 2p on Kilimapesa production alone. Increasing proven OZ’s will quickly rerate here imo, well obviously. But the point is it’s happening at pace.
Hence they have taken the opportunity with the raise to expand processing at Kilimapesa Gold. They already got an extra 1.2g/ton out of ops so I suspect the money means upscaling more so than just efficiency as efficiency is near optimal. That should yield more Oz’s and the market will factor that in pdq.
News on other ops will come with costs so important to make the warrant strike price and obviously any tailwinds from POG will help.
It’s a good find this one itsyou. With Papillon having made the hard yards this seems a pretty well timed entry price. Cheers.
Ps, OT, on subject of takeover’s I have a sneaky feeling on PAY + quarterly divi, +5% yield and imo near 600p is a bargain. Someone picked up 20%.
Ps Hi Mickey, thanks I read the RNS it’s the math that doesn’t add up. Atb.
Good luck with your investments
Usual caveats,
Trek
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