SDV - SciDev Limited

[imajica]

Ivanhoe selling is spooking the smaller investors - causing the drop

I must say I am getting a little concerned but the fundamentals haven't changed - medium to long term everything should be okay - I can understand if you were a trader you would be pretty frustrated with INL

 

[ezyTrader]

Ivanhoe selling is spooking the smaller investors - causing the drop

Has anybody wondered why Ivanhoe is selling? Esp. if the fundamentals are good...

 

[Dave31]

Has anybody wondered why Ivanhoe is selling? Esp. if the fundamentals are good...

This has been answered so many times!

It will be interesting to see how this closes. I'd like to pick some up at .20 or below, its just hit .195, might have to wait for monday to re-assess. I'm holding INL, looking to accumulate some more.

 

[powerkoala]

i guess there will be no more support level
as ivanhoe can sell at any price
correct me if i am wrong
before support is at 22-23c
then down to 21.5c
and now even worse...
guess 19.5c is the last holding level or it will drop even more

 

[imajica]

Ivanhoe is selling non-core assets to fund other projects - there is no ulterior motive here - they simply need their money for other things - INL is long term gold - people are panicking over nothing - this is causing the price drop

 

[constable]

i guess there will be no more support level
as ivanhoe can sell at any price
correct me if i am wrong
before support is at 22-23c
then down to 21.5c
and now even worse...
guess 19.5c is the last holding level or it will drop even more

Thats what im thinking, it wont be ivanhoe that pushes it down further, rather all the nervous traders activating stop losses...hmmm might put a buy order@18 - 18.5c just in case!

 

[moses]

I know bottom feeders swallow a lot of dirt, but both URA and INL must surely be juicy morsels today. I'd have bought INL today were it not for BLR being irresistable...

 

[constable]

I know bottom feeders swallow a lot of dirt, but both URA and INL must surely be juicy morsels today. I'd have bought INL today were it not for BLR being irresistable...

Well i bought in at 20.5 after that big mother of a order was placed. Will be interesting where ivanhoe places its next order, you would think that they'd be spewing at these prices.
edit and another 50k@ 20c now i hope i dont have to eat my earlier post about waiting @18.5c.

 

[Porper]

This has been answered so many times!

It will be interesting to see how this closes. I'd like to pick some up at .20 or below, its just hit .195, might have to wait for monday to re-assess. I'm holding INL, looking to accumulate some more.

My data is down again, were there any trades at all at 0.195 ?

If so I will be stopped out

 

[constable]

Well i think this must be really reaching value levels now. Volume today was the highest this year with sp falling 6% to get it. At what stage do ivanhoe say we wont go lower than these prices? Sure they need the money but the faster they sell the more they lose. Judging by the way the mill order came in at 20c to face off with the one seller at 20.5c i'd say inl is going to get some interest from some large bargain hunters.
no trades at 19.5c!

 

[CanOz]

Well i think this must be really reaching value levels now. Volume today was the highest this year with sp falling 6% to get it. At what stage do ivanhoe say we wont go lower than these prices? Sure they need the money but the faster they sell the more they lose. Judging by the way the mill order came in at 20c to face off with the one seller at 20.5c i'd say inl is going to get some interest from some large bargain hunters.
no trades at 19.5c!

To me its a critical juncture for this stock. If it breaks down through .20 then its broken through support of the old resistance and the channel support. It closed well off the open (high) and on above average volume.

Cheers,

 

[constable]

To me its a critical juncture for this stock. If it breaks down through .20 then its broken through support of the old resistance and the channel support. It closed well off the open (high) and on above average volume.

Cheers,

Fundamentally a lot has happened with this co (that is since november 06 when it was last @20c) and i just think at 20c now, it's too good to go past. Sure all the people who have bought at 25c and above are going to be wincing, but there must be a lot of money that sees it as a bargain at this entry level.

 

[wintermute]

I did this chart a few days ago when it was still at 21.5c I put the support line at 19.5c as even though there were two occasions it popped its head up to 20c before the rise, 19.5c was where the real resistance seemed to be to me....

The trend line I drew is the first one I've done so could be bogus

I bought more the other day at 23.5 obviously a bit prematurely (should have done the chart first.. doh) ... my average buy price is now 19.5c.... anyone setting stops I would suggest setting them at 18c or lower if you really don't want to be stopped out... I personally don't think we will see it close below 19.5c but, I do think we could see transitory drops to 18.5c

If you are worried about the big sellers, then why not consider the fact that someone is buying up everything they have to offer!! The buyers are the ones controlling what is happening here not the sellers!! If there were no buyers the sp would be way lower than it is now with the volume of shares that are being offloaded.

I'm in for the long haul, if it drops below 17c though then I'll be a bit concerned

Tony.

 

[drmb]

Zn still under pressure down more than 4% - at Kitco February 02,07:42 Bid/Ask 1.5006 - 1.5097, Change -0.0662 -4.23%, Low/High 1.5006 - 1.577 -Seems to be getting a hammering.

 

[drmb]

Very bad news on metal proces from London - Zn >12% fall. Red Kite hedge find in trouble has triggered sell off. What's opinion? Time to grit teeth and hang in (my choice) or dump and run. My feeling is the Chinese are not buying, but key date will be week after Chinese New Year when they will (hopefully) come back to the market. See http://za.today.reuters.com/news/ne...BS-MARKETS-METALS-20070202.XML&archived=False

Quote "Metals dive on report of fund losses Fri Feb 2, 2007 5:56 PM GMT LONDON (Reuters) - Base metals prices fell sharply on the London Metal Exchange on Friday on a report of heavy losses at a hedge fund and in the absence of Chinese buyers, dealers said.
"The market is collapsing," a European trader said. Three-months zinc fell by nearly 9 percent at one stage, copper was down by over 6 percent and aluminium dropped by some 3 percent in a general sell-off. Traders said the selling was mostly on behalf of funds, triggered by a report of heavy losses at a hedge fund that specialises in metals trading. Once prices hit specific chart levels the fall for most metals accelerated. "Fund liquidation...a lot of stops triggered -- a lot of the stuff on the back of the Red Kite news," the trader said. Hedge fund Red Kite, which posted strong gains in 2006, has suffered a roughly 20 percent loss in the first days of January and is now trying to stall investors who want to pull money out, The Wall Street Journal reported. "It is quite scary, actually, a lot of volume going through and no one is buying the stuff," analyst Michael Widmer at Calyon said. etc, etc" End quote

 

[clowboy]

I personally don't think we will see it close below 19.5c but, I do think we could see transitory drops to 18.5c


Tony.

mmm well given zinc's ON performance, maybe we will see some stupid figure like 15cps on monday.

 

[dhukka]

Zinc down 12%, INL is going to get smacked on Monday. Has the market over-reacted to Red Kite's request to slow redemptions? Who knows, picking the bottom in zince prices and anything else for that matter is fraught with danger. It usually wise to get out of the way of a runaway train. The 6 month, 1 year and 5 year charts look horrible. INL under 15c is looking like a real possibility

 

[TheAbyss]

Definitely not what I wanted to hear D. Anyone concur or have analysis to support? My stop will get hit and I am out which I dont really want to do.

 

[ALFguy]

Zinc down 12%, INL is going to get smacked on Monday. Has the market over-reacted to Red Kite's request to slow redemptions? Who knows, picking the bottom in zince prices and anything else for that matter is fraught with danger. It usually wise to get out of the way of a runaway train. The 6 month, 1 year and 5 year charts look horrible. INL under 15c is looking like a real possibility

Personally, I think a drop in Zinc prices shouldn't be looked at as 'doom and gloom' for zinc companies. Everything points towards long term demand.

INL's chart only looks iffy because since the beginning of December, so much stock has been offloaded. If this hadn't happened, I imagine the sp would be over 30c by now - looking at the chart pre Dec that is.

IF INL hits 15c, I'll be buying for sure. I just can't see it though.

 

[wintermute]

Some fundamentals of INL for anyone getting concerned.... Below from the April 5th 2006 announcement.

The 10.9 million tonnes Hellyer tailings dam resource contains (along with lead, silver, gold and copper) 305,000 tonnes of zinc at an average grade of 2.8%, which alone at today’s US$/A$ exchange rate and LME zinc price has an in-situ metal value of over A$1.1 billion.
The 10.9 million tonnes Hellyer tailings dam resource contains (along with lead, silver, gold and copper) 305,000 tonnes of zinc at an average grade of 2.8%, which alone at today’s US$/A$ exchange rate and LME zinc price has an in-situ metal value of over A$1.1 billion.

and that doesn't take into consideration the lead and silver...

Intec's current market cap is about 112 Million... Note that 1/2 of all profit made for the 1st 2 years goes to Polymetals, and half of the ongoing production costs are borne by Intec.... This also from the same announcement...

The CLA provides for an unincorporated joint venture (JV) owned equally by IHM and PMS. PMS will operate the Project and sole-fund the ‘Start Up Costs’ in an amount of A$4 million or such larger amount as is required in order to achieve ‘Steady State’, being an annualised tailings throughput of 1.5 million tonnes and producing concentrate grading >35% zinc. After Steady State has been achieved for a continuous 21 day period, the JV will commence to bear the Project operating costs for a period of two years, with an option to renew the Project yearly for a further two years. Four years after commencement of Steady State, IHM will have the right to acquire PMS’s 50% interest in the JV for A$1.
The JV is projected initially to produce about 63,000 tonnes of concentrate per annum, though it is intended over time to significantly increase this amount by expanding the tailings throughput capacity of the Mill to above 2 mtpa. INL has commenced technical investigation of the opportunity to blend EAF dust (grading ~30% zinc) into the concentrate product.
It is important to note that:
1) all Hellyer assets, the refurbishments of which will be depreciable capital improvements, remain the property of IHM at all times;
2) the refurbished Mill will be made available as much as practically possible to treat ores from regional miners (notably including Bass Metals Ltd (ASX code: BSM) which is 22.1% owned by INL);
3) the retreatment residues from the Mill will be returned to the tailings dam where, though depleted of two thirds of their contained zinc value (and of 17% and 10% of their lead and silver values respectively), they will be available for treatment yet again via Intec’s Hellyer Metals Project technology, after being augmented with high grade zinc secondary residues such as EAF dust, lead smelter slags and primary leach residues; and
4) the effect of (3) above is that the JV’s Project (under PMS’s operational management) will in no way cut across the overall Intec Hellyer Metals Project, whose Burnie Demonstration Plant is now achieving its required technical outcomes and will very shortly be the subject of a separate ASX announcement.

There is some important info in that snippet! not the least of which is that after 4 years Intec will be getting 100% of the revenue from the project! I suggest anyone holding INL who hasn't read that announcement should do so, as well as a few of the earlier ones... I gave a list before I think of some of the important ones.

I have also done some rough calculations based on the figures in INL's latest report... and I came up with a revenue figure of about $40 million US. After conversion to aussie $ using an exchange rate of 0.77 we have approx 52 million gross revenue.

This is based on the projected 65,000 tpa of concentrate and the reported percentages of zn pb and ag.

using prices slightly below current spot prices and dividing the figure by 2 (because of the JV) and then taking 90% of the metal value (which is what they are getting for it) I came up with

zn 33 million
pb 4.3 million
ag 3.1 million

Note prices used were:
zn $3000/tonne
pb $1700/tonne
ag $13.40/oz


I may have made a mistake here!! note I do not know what the production costs actually are, but the projected costs in April last year were AUS $50 million per annum, $25 million of which go to INL... so that would leave $27 million in profit... with 557 million shares on issue that comes out to about 4.8c eps (note that I have not factored tax in as accumulated losses at June 2006 were 39 million). This also doesn’t take into account depreciation an amortization, I have assumed they are in the $50,000,000 annual costs quoted in the April report (not necessarily a correct assumption).

So based on slightly lower than current metals prices, a p/e of 10 and some assumptions that they will meet production targets, it would seem the sp should be around the 48c mark based just on the JV... of course this is an overly simplistic valuation, and I could have stuffed up, but it does tend to support my feeling then INL have been oversold

Of course I could well have made some major mistakes here so don’t rely on my figures alone… however if these figures are even remotely close, zinc prices could go down substantially and Intec would still be in a profit situation. Their original April 2006 profit forecast was based on a zinc price of about US $1980/tonne. Based on that price their eps would have been approx 1.7c (or 17c share value with p/e of 10!) so unless we see a massive drop in the price of zinc I think that INL if it does drop Monday will just be even more of a bargain than it already is

Tony.