Love it.
Buy the rumor sell the fact.
Stopped out with small profit.
Held for a while--a while to long it seems.
Interesting to watch how it goes through the day, Relatively small volume traded on open, I was quite surprised by that and by the low open. I was expecting to see 10 -20 million traded on open, but very subdued. Holding patiently for now.
Yes grabbed a slightly larger position just above my stop out price.
I'll have a sit for a while.Stop.069
Bad luck Tech, there was some really keen sellers there. The sell the fact pressure was too great. This was good value at about 2c, but was carried to far by the taxi drivers over in la la land.OK I give up for a while! Testing both ends Ive contributed enough.
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You back in yet Tech?
If it can clear 7.2 we might get some momentum.
I'm still really surprised by this whole thing. I really didn't expect to see a narrow trading range like this.
All a bit of a learning experience really.
Any ans to my previous post about the 4:1?
Do you think it will spike to 30 cents on monday before the profit takers come in?
I wonder if it will open at 5 cents due to the 4:1?
please enlighten me with your tech thoughts if possible.
The market isn't always rational. there are other factors that come into play. This one is in India, I assume others are in Australia. Costs of production, freight, governments are different with national aspects to be considered. Lots of unknowns to be considered. In hindsight it would have been nice to take the 10.5c before trading ceased. Next week is a new ball game and the price on opening could be anywhere from 4c to 10c. It must be a buy at 4c and a sell at 10c but that's a guess so let's wait before becoming a lemming.
Just out of a full afternoon meeting.
That was/is ugly!!!
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Ok so to tackle each point of uncertainty one by one
Capital Structure
Shares fully diluted post consolidation 100m
Merger consideration 400m
Capital raising $25m at 25c = 100m
(Based on minimum price of 20c, current implied SP of 40c and very very tough mkt conditions)
Performance Shares = 400m
It should be noted that Performance shares Class B requires the validation of a $350m NPV = 35c a share value and Class C requires Production to commence = a large mkt cap too
Total Shares = 1 Billion
Deposit/Project Size
The company says an exploration target over 500Mt's-770Mt's@ 25% - 35% Fe
The average of this is 635Mt's@30%Fe
But then the company also says the exploration UPSIDE target for the project is 1.2Billion Metic tonnes ?????
So I will use 2 deposit sizes
600Mt's@30%fe
1.2Billion Tonnes@30% Fe
Value?
The EV is going to be hard to come to but given that it can vary from as low as 20c to ealry stage low confidence projects to $2/t Magnetite for some takeover deals,
I feel comfortable using 25c for an infered JORC/Historical target but will also use 50c to show the value of a firmer JORC and $1 to show the value of a takeover
600Mt's@ 30%Fe = 180Mt's Mag @ 25c = $47.5m = 4.75c using 1 Billion Shares
1.2 Billion t's@ 30%Fe = 360Mt's Mag @ 25c = $95m = 9c using 1 Billion Shares
600Mt's@ 30%Fe = 180Mt's Mag @ 50c = $95m = 9.5c using 1 Billion Shares
1.2 Billion t's@ 30%Fe = 360Mt's Mag @ 50c = $190m = 19c using 1 Billion Shares
600Mt's@ 30%Fe = 180Mt's Mag @ $1 = $180m = 18c using 1 Billion Shares
1.2 Billion t's@ 30%Fe = 360Mt's Mag @ $1 = $360m = 36c using 1 Billion Shares
So we get a range of values of
Intial target @ 25c EV/t = 4.75c
Intial target @ 50c EV/t = 9c
Intial target @ $1 EV/t = 18c
Upside target @ 25c EV/t = 9c
Upside target @ 50c EV/t = 19c
Upside target @ $1 EV/t = 36c
Conclusions and comments
Well as I said all along, I loved NSL at 1.5c-2.5c, do I still love it at 10c? Not really, would I buy? No, BUT THEN THATS BECAUSE THIS ISN'T MY STYLE of investment, ie I WOULD NOT HAVE BOUGHT SDL WHEN IT WAS 10c, ITS NOW 25C so I hope you see just because I am not prepared to buy somehting doesn't mean there is no further value, with SDL there was between 250% to 400% further value
I have done my best to show a range of potential valuations for NSL, it should be remembered I am no expert and I am not offering any advice, rather just trying to help others make heads or tails of the whole thing, I hope my effort is appreciated
Good luck guys and remember REGARDLESS THE MKT IS THE ULTIMATE JUDGE
Interesting how this got to around 5c which is the figure I got based on 25c/t Mag EV for the mid range 600Mt historical figure which was my most comfortable range
These are very difficult mkts at the moment
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