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Dumbpunter
Unsure to be honest. CL is building a pilot plant to test the DLE and has also been given acreage to explore for lithium offshore. They are also digging for hard rock spodumene in the mica deposit near St Austell as well. Given how fast things are moving, I would not be surprised if they raise more money later this year or early next year. They overfunded last round by over 500% in a week. CL could become an absolute monster as it will effectively control all the lithium in the UK.
What is certain is that management said they plan to IPO the company by 2023. I’ll keep you posted if and when they do the next capital raise.
Luke
I am a shareholder in Cornish Lithium.
I participated in both the first capital raise in 2019 and then again in 2020. Very happy with developments. Cornish uses Vulcan Energy as its direct comparison although I believe Cornish will use both DLE and spodumene eventually. Last capital raise was at a mere GBP 40m market cap. I expect the next raise will be several times that amount. :)
Europe is desperately short of lithium supply and EVERY project which is economical will likely get the green light to move forward.
Upside potential
Have a look at the link below:
https://www.sharesmagazine.co.uk/news/market/LSE20200930070005_3732444/Proposed-sale-of-holding-in-Zinnwald
My understanding is that the Zinnwald project was previously owned by Deutsch Lithium, which was owned 50/50 by Erris and Solarworld. Erris has since been spun off as a sole gold project while ZNWD retains the 50% stake in the lithium project. ZNWD has the right of first refusal to acquire the remaining 50% interest from Solarworld. This is highly likely to be the case, which would give ZNWD a 100% interest in the project on the German side, which is believed to contain 1/3 of the overall resource. Given EMH owns half of the project on the Czech side, then ZNWD should be valued the same resource amount. Does that make sense now?
I am a relatively new shareholder (bought in late last year) and have no background around the time when Erris used to be the joint owner of the project. So I hope the longer term holders can chime in and correct me if I’ve said anything that is not accurate.
UpsidePotential
It is estimated 1/3 of the overall resource base lies in Germany under acreage owned by ZNWD.
EMH owns a 49% stake in the Cinovec project. So if you extrapolate things and believe that 1/3 of the resource is indeed in Germany, then ZNWD should be valued the same as EMH, which implies a share price of over 60p.
I decided to top up again at nearly 16p today. I'll continue to do so as and when I have any spare cash as it's still a no-brainer at current valuation IMHO. DYOR.
https://wp-zinnwald-lithium-2020.s3.eu-west-2.amazonaws.com/media/2020/11/04113745/Zinnwald-Corp-Presentation-04.11.20-final.pdf
Hope the link works now!
Hi folksPage 12 of the latest investor presentation summarises well and shows how undervalued ZNWD is compared to its European peers.https://wp-zinnwald-lithium-2020.s3.eu-west-2.amazonaws.com/media/2020/11/04113745/Zinnwald-Corp-Presentation-04.11.20-final.pdfIt is one of only 2 companies already at DFS stage. For full disclosure, I own shares in EMH, INF and ZNWD.Among those, INF and ZNWD are the most undervalued IMHO given their resource base and current project status.
Wow, the share price has taken off like a rocket this morning. I wanted to do a small top-up at sub 15p but the market makers moved the spread so quickly...it's already at 16p now. Doh!
Guess I'll have to make do with what I have. It's still very undervalued at current level.
Malik
Great minds think alike. My average is 9.4p after doubling my holdings yesterday.
The market is finally recognising how undervalued ZNWD is. I've been saying this for 2 months and like you tried to get people's attention on the EMH board but no one cared. Well, you now have to buy at nearly double the price.
Malik
ZNWD is significantly undervalued IMO. I own 5 other lithium stocks listed on the ASX and TSX and all of them have a market cap several times that of ZNWD. The smallest one SYA has a market cap of GBP 80m after its deal with Piedmont...
As a quick fact check, according to the article you circulated, ZNWD sits on 1/3 of the overall resource base that it shares with EMH. EMH's market cap is GBP 128m and it owns 49% of the project. By very simple (and crude) assumptions, that implies ZNWD should be valued at GBP 128m as well since it owns 1/3 of the overall resource base. That's 5.5x from the current market cap. That's an absolute no brainer to me, which is why I doubled my holdings yesterday even though my previous average was below 7p.
Compared to all the lithium stocks that I own, I believe ZNWD is the most undervalued stock among all of them. DYOR.
Malik
I don’t go to the EMH board anymore as it’s a lot more crowded these days.
I’ve also been building up my position in ZNWD since last year and decided to add more today. I believe there is a fair chance we will see the 2 companies eventually merge. The fact that Dr Mueller, the CEO of Deutsche Lithium already said they are open to a merger is exciting news. We just need the Czech and German govts to give their green light to kickstart the process. The EU is desperately short of lithium and automakers will need a lot more in the coming decades. An offtake agreement is imminent with EMH and that could accelerate talks with ZNWD. This is exactly what happened with Piedmont and Sayona this week. Piedmont has an offtake with Tesla and is taking a stake in Sayona in order to consolidate the lithium supply in North America. So a merger between EMH and ZNWD would make even more sense!
Malik
Fantastic fine. Well done for bringing this to our attention.
A merger with EMH would make complete sense given the amount of synergies involved from having to build a single mine instead of 2. The capex involved would be significantly reduced.
Being a holder in both EMH and ZNWD, I doubled my holding in ZNWD today because a potential merger would re-rate ZNWD even faster. ZNWD's market cap is still only GBP 23m. What an absolute bargain!
Atlantic
1. This scenario is unlikely to be successful for the reasons that I mentioned earlier, ie. the main shareholders can block any unappealing bids. I read that Eric participated in the last capital raise and instructed management to continue drilling and expanding the resource base as the company reminded him of Kirkland lake gold in which he is a shareholder. He didn’t want PUR to just build the mine.
2. I previously shared an analysis by a poster on CEO.ca who seems quite knowledgeable about how to value miners. Assuming we get a (conservative) 500k resource increase, he worked out the fair market value would be C$3.70 / £2.20 per share. The next catalyst is drilling of the 8 zone. If this proves to be a major gold system, then I would expect a significant re-rating as the annual production would skyrocket due to the higher grade ore and hence lower AISC. I do not have a figure in mind in that scenario but it would be significantly higher than the £2.20 price mark.
I believe only then would management consider selling the company once all those milestones have been achieved. Then we need to add a takeover premium which could be anything from 25-100%.
Hope that helps.
Atlantic
A potential takeover offer could well happen but it would have to come with a significant premium. Newmont, Anglo and Eric Sprott control over 40% of the company and can block any low ball bids.
My expectation is that PUR will remain independent for at least another year whereby management will increase the resource base and wait for a higher gold price. I don't think the main shareholders and management will want to sell before they have drilled the 8 zone in H2 2021 for obvious reasons.
Saxondale
Welcome back to PUR.
As Warren Buffet said:
"Be fearful when others are greedy and be greedy when others are fearful"
I believe we are approaching the bottom of the downtrend and most weak hands have already sold by now. We will likely see institutional generalist investors jump in once the company enters commercial production in the next few months.
Graking
My opinion is that the market will be caught completely off guard when the new resource estimate is released. Given the much higher gold price compared to when the last estimate was announced, it could well be we see a significant upgrade in the number of oz under the M&I category. I am hoping for a 1m+ oz increase to 3m+ oz in M&I and perhaps 1m oz in inferred.