obviously this finance deal is better than the last one tabled, some how i think folks are calculating incorrectly...if this deal was to exspensive red would have done a 100% capp raising....and lets face it red could have easly raised all the funds needed....my thinking is the recent sp runup had nothing to do with the finance deal , more likerly to do with mapawa, if there was a leak this is were it would have come from....there must be something disscoverd for them to spend $20 000 000 drilling mapawa......my thoughts only
VAU - Vault Minerals
- Thread starter Uncle Festivus
- Start date
- Joined
- 19 May 2010
- Posts
- 293
- Reactions
- 1
Hey Beatle I was wondering if you could post a new valuation for RED? Already we've got people on the HC forums downramping (hey Smity if you're reading this lolol) saying management are muppets etc, how do you view it? Should we have just gone a 100% CR from shareholders?
Good morning all, and wow, what a surprise when I opened up my computer this morning to read this announcement on the finance.
Based on my first reading of the announcement I'm surprised and reasonably happy although until we know the final details its hard to fully assess what it means, and how to evaluate it. I'm relieved that it included a large debt component, but surprised it was an increased funding amount.
The timing of the announcement is bad, as I'm due to be traveling for the first couple days of next week and will be out of contact for that time, so I hope that the Trading Halt goes the distance!
The first thoughts and questions in my head are:
1. What is the placement price;
2. What does the outstanding due diligence consist of and how long will it take;
3. Why the need to seek an additional US$10 million, from US$40 million previously to now US$50 million at this stage. Presumably since only the other day the announcement re Siana status confirmed RED was marginally under budget this must relate to more funds for Mapawa but why so much more now;
4. I presume that there will be even more involvement of insto's again, and therefore the share price is likely to be supported quite strongly on opening, but that we may still see "manipulation", with dips and flows upwards based on the motives of those insto's! As Fatsoh has noted, imagine a negative BOT versus a positive BOT! Lol
5. Having already established a model that covers a number of scenarios of debt and equity I have no doubt that the effects of the financing will be share value accretive and the debt component is a real positive, but the extent of that increase from closing price of 20.5 cents can't be evaluated with sufficient accuracy until knowing the critical details and particularly regarding the placement price.
6. The fee charged does not seem excessive if its a combined fee for both the equity and debt components, as on the face of it there appears to be also a small put/call option facility in the gold deliveries (the current high cost of option hedging currently due to high volatility will have also had an impact on the pricing I'm sure). Again the details need to be fully worked through.
As a general observation, I have no reason to think that the announcement is anything but positive for RED share price, as it provides:
1. All the money to develop Siana;
2. Additional fire power to advance Mapawa AND THE OTHER porphyry projects lurking in each of RED's MPSAs - don't forget Madja and the other southern porphyry's that have shown up in geophysical work plus surface sampling;
3. It brings together even more insto's supporting RED with a major investment that should see RED share price move up quickly to its fundamental value over the following months based on Siana alone;
On this point, anyone who argues that it should have been a capital raising from shareholders are seriously deluding themselves! There is no way RED could guarantee such funding plus the time to progress it.
As I have always indicated, RED is now influenced by major backers who will take it to its next leg up, and as I have waited for that to happen now for many years I will wait that extra bit longer. I know we will achieve a price far in excess of what it currently is, and I don't want to ever say I sold too soon to miss out on that re-rating: 20.5 cents is great, but what it goes to will be far greater in my opinion!
Anyone bagging RED management for this funding package clearly demonstrates either their lack of knowledge of debt and capital markets (and probably has a chip on their shoulder with management). Jumping into criticise RED without having the details of the package suggests to me once more that the motivations of critics should be questioned, especially if they don't have any shares in RED!
How can you come up with such a negative conclusion, without all the details, whilst this funding assures RED of gold production, and enables Mapawa to be more fully explored, for the benefit of all shareholders, not just the insto's that support our share price as much as we want them to support it on our behalf as smaller investors.
Based on my first reading of the announcement I'm surprised and reasonably happy although until we know the final details its hard to fully assess what it means, and how to evaluate it. I'm relieved that it included a large debt component, but surprised it was an increased funding amount.
The timing of the announcement is bad, as I'm due to be traveling for the first couple days of next week and will be out of contact for that time, so I hope that the Trading Halt goes the distance!
The first thoughts and questions in my head are:
1. What is the placement price;
2. What does the outstanding due diligence consist of and how long will it take;
3. Why the need to seek an additional US$10 million, from US$40 million previously to now US$50 million at this stage. Presumably since only the other day the announcement re Siana status confirmed RED was marginally under budget this must relate to more funds for Mapawa but why so much more now;
4. I presume that there will be even more involvement of insto's again, and therefore the share price is likely to be supported quite strongly on opening, but that we may still see "manipulation", with dips and flows upwards based on the motives of those insto's! As Fatsoh has noted, imagine a negative BOT versus a positive BOT! Lol
5. Having already established a model that covers a number of scenarios of debt and equity I have no doubt that the effects of the financing will be share value accretive and the debt component is a real positive, but the extent of that increase from closing price of 20.5 cents can't be evaluated with sufficient accuracy until knowing the critical details and particularly regarding the placement price.
6. The fee charged does not seem excessive if its a combined fee for both the equity and debt components, as on the face of it there appears to be also a small put/call option facility in the gold deliveries (the current high cost of option hedging currently due to high volatility will have also had an impact on the pricing I'm sure). Again the details need to be fully worked through.
As a general observation, I have no reason to think that the announcement is anything but positive for RED share price, as it provides:
1. All the money to develop Siana;
2. Additional fire power to advance Mapawa AND THE OTHER porphyry projects lurking in each of RED's MPSAs - don't forget Madja and the other southern porphyry's that have shown up in geophysical work plus surface sampling;
3. It brings together even more insto's supporting RED with a major investment that should see RED share price move up quickly to its fundamental value over the following months based on Siana alone;
On this point, anyone who argues that it should have been a capital raising from shareholders are seriously deluding themselves! There is no way RED could guarantee such funding plus the time to progress it.
As I have always indicated, RED is now influenced by major backers who will take it to its next leg up, and as I have waited for that to happen now for many years I will wait that extra bit longer. I know we will achieve a price far in excess of what it currently is, and I don't want to ever say I sold too soon to miss out on that re-rating: 20.5 cents is great, but what it goes to will be far greater in my opinion!
Anyone bagging RED management for this funding package clearly demonstrates either their lack of knowledge of debt and capital markets (and probably has a chip on their shoulder with management). Jumping into criticise RED without having the details of the package suggests to me once more that the motivations of critics should be questioned, especially if they don't have any shares in RED!
How can you come up with such a negative conclusion, without all the details, whilst this funding assures RED of gold production, and enables Mapawa to be more fully explored, for the benefit of all shareholders, not just the insto's that support our share price as much as we want them to support it on our behalf as smaller investors.
Hi ParleVousFrancais and Fastbuck, and all.
PVF, in reading your posts yesterday I was impressed that you are a young guy with a very mature and sensible outlook on your share investments, and I could do with a bit more of that unemotional attitude that you referred to. If I can suggest something to you with regard to RED and knockers such as Smity.
Note that RED's future share price will not be controlled nor severely influenced by the daytraders or small retail shareholders, it will be moved by the big insto's that trade millions of shares at a time. Thus we smaller investors are the only ones that can be influenced, IF we want to be influenced, by people such as Smity. Although I don't know him, I have no doubt he is trying to stir management at RED, possibly he has had a run in with them previously, maybe as an employee or similar. My concern is that he could influence the small guys who read ASF or HC into selling out prior to getting the big return on their investment. He certainly won't be influencing the insto's in how they invest in RED. So keep your objectivity as you have already demonstrated that to me in your past posts and observations (hopefully you will even decide to take your initial exiting price for 50% a tad higher than you have planned, provided the market or gold price doesn't tank in the next few days, and I can't see that happening!).
PVF, in reading your posts yesterday I was impressed that you are a young guy with a very mature and sensible outlook on your share investments, and I could do with a bit more of that unemotional attitude that you referred to. If I can suggest something to you with regard to RED and knockers such as Smity.
Note that RED's future share price will not be controlled nor severely influenced by the daytraders or small retail shareholders, it will be moved by the big insto's that trade millions of shares at a time. Thus we smaller investors are the only ones that can be influenced, IF we want to be influenced, by people such as Smity. Although I don't know him, I have no doubt he is trying to stir management at RED, possibly he has had a run in with them previously, maybe as an employee or similar. My concern is that he could influence the small guys who read ASF or HC into selling out prior to getting the big return on their investment. He certainly won't be influencing the insto's in how they invest in RED. So keep your objectivity as you have already demonstrated that to me in your past posts and observations (hopefully you will even decide to take your initial exiting price for 50% a tad higher than you have planned, provided the market or gold price doesn't tank in the next few days, and I can't see that happening!).
- Joined
- 19 May 2010
- Posts
- 293
- Reactions
- 1
Thanks for the compliments Beatle!
I read that the trading halt is for the next 2 days while the instos determine the price they'll pay for shares in RED. I'm thinking that the short term price will hover maybe 2-3 cents at most above the issue rate to the instos. A quick 10% return on their purchase for a portion of their shares seems to me like the short term thinking of most of them (gotta make the figures for the quarter!). I'm hoping that this deal really is a better one than 100% CR, it'd suck if they got this far with exploration and development only to throw lots of potential away with the final financing deal. I guess it all depends on the price of the placement to instos. Here's to instos using your method of valuing RED and outbidding each other to pay 30 cents a share each
.
I've taken my sell order off the table from 25 cents, I'll see what happens to the share price after the trading halt is lifted (it can last until wednesday from what I gather), I'm still somewhat inclined to sell at 25 cents to pay back some of my debt but the 20 million earmarked for Mapawa exploration has me listening. We'll see what happens on Wednesday (or whenever RED reopens).
I read that the trading halt is for the next 2 days while the instos determine the price they'll pay for shares in RED. I'm thinking that the short term price will hover maybe 2-3 cents at most above the issue rate to the instos. A quick 10% return on their purchase for a portion of their shares seems to me like the short term thinking of most of them (gotta make the figures for the quarter!). I'm hoping that this deal really is a better one than 100% CR, it'd suck if they got this far with exploration and development only to throw lots of potential away with the final financing deal. I guess it all depends on the price of the placement to instos. Here's to instos using your method of valuing RED and outbidding each other to pay 30 cents a share each
.I've taken my sell order off the table from 25 cents, I'll see what happens to the share price after the trading halt is lifted (it can last until wednesday from what I gather), I'm still somewhat inclined to sell at 25 cents to pay back some of my debt but the 20 million earmarked for Mapawa exploration has me listening. We'll see what happens on Wednesday (or whenever RED reopens).
ParleVousFrancais, just to confirm, the Trading Halt can last as long as 2 days (ie 48 hours from it being lodged), so it can last till open on Wednesday, but RED could call a further halt by having the company suspended temporarily. That can last indefinitely.
If you are hoping to repay debt with your first 50% maybe there is sense in you clearing that at the price you see reasonable - I always assume that someone is in the market and can expect to lose up to 100% of their investment in these shares without it affecting their personal situation. I have a fairly significant holding myself but if it turned out to be fully priced at current levels or fell back to 12 cents I wouldn't be affected personally! (Keeping in mind I have been at it for more years than I want to remember!).
In terms of the pricing, I am not expecting a premium to current share price for the placement, its most probably going to be a discount, but in the overall context of what it delivers to RED (and therefore to us shareholders) I am not fussed - and these insto's will not be dumping to make a 10-15-20% or so gain that smaller shareholders would do if it were offered as a SPP or rights issue.
Also I don't believe for a moment that you will find RED share price move up appreciably once the TH is removed, as I think the insto's will sit back to see what some investors want to do, after all they have no interest in just buying shares at inflated prices if they think the mainstream of smaller investors want to get out at any reduced price! So expect the same sort of games and the rolling around of price in the days after resuming trading.
If you are hoping to repay debt with your first 50% maybe there is sense in you clearing that at the price you see reasonable - I always assume that someone is in the market and can expect to lose up to 100% of their investment in these shares without it affecting their personal situation. I have a fairly significant holding myself but if it turned out to be fully priced at current levels or fell back to 12 cents I wouldn't be affected personally! (Keeping in mind I have been at it for more years than I want to remember!).
In terms of the pricing, I am not expecting a premium to current share price for the placement, its most probably going to be a discount, but in the overall context of what it delivers to RED (and therefore to us shareholders) I am not fussed - and these insto's will not be dumping to make a 10-15-20% or so gain that smaller shareholders would do if it were offered as a SPP or rights issue.
Also I don't believe for a moment that you will find RED share price move up appreciably once the TH is removed, as I think the insto's will sit back to see what some investors want to do, after all they have no interest in just buying shares at inflated prices if they think the mainstream of smaller investors want to get out at any reduced price! So expect the same sort of games and the rolling around of price in the days after resuming trading.
Hi all,
First of all Thanks to Beatle and others that have contributed their thoughts/ideas.
I completely agree with beatle in regards to the unreasonable expectation of the financing deal being completely debt. I always expected it to be part debt/part equity and thus (using Beatle' evaluations as a guide) evaluted the Siana project to be in the mid 30s. Although the large amount of options given does worry me a little, but they are only excercisable at 40c (according to my memory). Since most of all have bought in in the 10s, that is easily a 300%+ before the options come into play.
In regards to beatle's posts about the announcement not having a positive effect on the share price as a result of institutions getting a discount to current prices. I see it from another angle. Assuming the institutions do indeed stand on the sidelines, surely the retail investors like you, i (and many others hopefully) will see this announcement as being of positive value to the company. Thus, people like you and I are unlikely to offload shares until well into the 30c (if not longer). Therefore, by that logic, supply is likely to dry up (unless sp moves up substantially). The institutions (steele) is not likely obviously not dump now. However, what about those retail investors that are sitting on the sidelines? waiting for the financing deal to secure BEFORE buying a stake? These investor, although may be small time, but if there are enough of them, can really drive up the SP (especially if supply dries out). Like P's withdrawal of his 25c order.
On the otherhand, if Beatle is indeed right (we are almost getting sick of that), and the SP does indeed drop. I, for one, will be increasing my stake...so if anyone of you wants to offload at sub 20 especially now with finance in place (and Mawa lingering..)...send them this way?.
Just my thoughts. Would love to hear how beatle thinks.
First of all Thanks to Beatle and others that have contributed their thoughts/ideas.
I completely agree with beatle in regards to the unreasonable expectation of the financing deal being completely debt. I always expected it to be part debt/part equity and thus (using Beatle' evaluations as a guide) evaluted the Siana project to be in the mid 30s. Although the large amount of options given does worry me a little, but they are only excercisable at 40c (according to my memory). Since most of all have bought in in the 10s, that is easily a 300%+ before the options come into play.
In regards to beatle's posts about the announcement not having a positive effect on the share price as a result of institutions getting a discount to current prices. I see it from another angle. Assuming the institutions do indeed stand on the sidelines, surely the retail investors like you, i (and many others hopefully) will see this announcement as being of positive value to the company. Thus, people like you and I are unlikely to offload shares until well into the 30c (if not longer). Therefore, by that logic, supply is likely to dry up (unless sp moves up substantially). The institutions (steele) is not likely obviously not dump now. However, what about those retail investors that are sitting on the sidelines? waiting for the financing deal to secure BEFORE buying a stake? These investor, although may be small time, but if there are enough of them, can really drive up the SP (especially if supply dries out). Like P's withdrawal of his 25c order.
On the otherhand, if Beatle is indeed right (we are almost getting sick of that
), and the SP does indeed drop. I, for one, will be increasing my stake...so if anyone of you wants to offload at sub 20 especially now with finance in place (and Mawa lingering..)...send them this way?.Just my thoughts. Would love to hear how beatle thinks.
Hi Wtang, and interesting comments you make.
Actually I do want to clarify one point with you regarding my view on the announcement on finance as it stands, without knowing the details that should be most enlightening in the first days of next week - my overall view is that the offer package is quite acceptable, and as it also guarantees development of Siana within the timeframe, I see it as being positive! I didn't expect people reading my comments above as interpreting them as negative at all, but i was just trying to make the point that if the share price doesn't go up immediately RED resumes trading, it shouldn't be interpreted to mean that the finance is unacceptable - more than likely its going to be whatever the insto's want it to be. IF they think that they can rattle the market for a couple of days, even a week, then its possible that the selling of smaller retail clients might give insto's one last opportunity to fill up at these cheaper prices!
Also, the options being granted to the group offering finance - they are to be offered at 35% above the placement price, whatever that might be. eg if placement is 20 cents (and I'm not saying it will be at all!), then the options exercise price is 1.35 x 20 cents = 27 cents (ie cost of exercise will be $0.27 x no. of options exercised within 3 years = $7.56 million to RED upon issuance of shares when exercised).
Additionally, the exit for all the larger shareholders such and Matthews or Baker Steel, etc, is likely to be the offer of a corporate takeover of RED, probably when Mapawa is closer to being confirmed as a genuine gold-copper porphyry. I don't believe that the insto's will be putting any significant selling in place for a long time, certainly not before complete re-value has been added to RED beyond mid 30 cents and likely upwards when in premium at time of gold production!
Actually I do want to clarify one point with you regarding my view on the announcement on finance as it stands, without knowing the details that should be most enlightening in the first days of next week - my overall view is that the offer package is quite acceptable, and as it also guarantees development of Siana within the timeframe, I see it as being positive! I didn't expect people reading my comments above as interpreting them as negative at all, but i was just trying to make the point that if the share price doesn't go up immediately RED resumes trading, it shouldn't be interpreted to mean that the finance is unacceptable - more than likely its going to be whatever the insto's want it to be. IF they think that they can rattle the market for a couple of days, even a week, then its possible that the selling of smaller retail clients might give insto's one last opportunity to fill up at these cheaper prices!
Also, the options being granted to the group offering finance - they are to be offered at 35% above the placement price, whatever that might be. eg if placement is 20 cents (and I'm not saying it will be at all!), then the options exercise price is 1.35 x 20 cents = 27 cents (ie cost of exercise will be $0.27 x no. of options exercised within 3 years = $7.56 million to RED upon issuance of shares when exercised).
Additionally, the exit for all the larger shareholders such and Matthews or Baker Steel, etc, is likely to be the offer of a corporate takeover of RED, probably when Mapawa is closer to being confirmed as a genuine gold-copper porphyry. I don't believe that the insto's will be putting any significant selling in place for a long time, certainly not before complete re-value has been added to RED beyond mid 30 cents and likely upwards when in premium at time of gold production!
Thanks Beatle,
I just reread the financing report and saw my mistake about the 40c (dunno where i got that figure from). BUt you are quite right, and i agree with you about the role that institutional buying will play on the stock price. I was merely expressing my opinion in regards to retail investors. I guess the big question with the options is how the price is determined (is it current market, 3 month average? or what)...because the way that price is determined will be very closely related to how the red will open on wednesday. On another note, part of me actually wants to see red fall below 20c....one last opportunity for me to fill up also ^^.
I just reread the financing report and saw my mistake about the 40c (dunno where i got that figure from). BUt you are quite right, and i agree with you about the role that institutional buying will play on the stock price. I was merely expressing my opinion in regards to retail investors. I guess the big question with the options is how the price is determined (is it current market, 3 month average? or what)...because the way that price is determined will be very closely related to how the red will open on wednesday. On another note, part of me actually wants to see red fall below 20c....one last opportunity for me to fill up also ^^.
- Joined
- 19 May 2010
- Posts
- 293
- Reactions
- 1
Hmm, I'm thinking the reports of RED's death are vastly exaggerated on HC. The mine will be going ahead and on time, Mapawa is getting lots of exploration funds assigned to it, and we've finally got the long awaited finance in place.
Sprott asset management seems to me to be a very professionally run firm, with large amounts of funds under management, and no doubt they would have done due diligence on the Siana mine which produced the goods economically (otherwise why would they invest?).
I guess they'll always be people who say that companies are going bankrupt or that they are nothing but "big punts" without actually researching data.
Sprott asset management seems to me to be a very professionally run firm, with large amounts of funds under management, and no doubt they would have done due diligence on the Siana mine which produced the goods economically (otherwise why would they invest?).
I guess they'll always be people who say that companies are going bankrupt or that they are nothing but "big punts" without actually researching data.
what also needs to be concidered and is quite possible red will produce a modest 30 000 oz for the second half of 2011 @$1350 per oz x $1000 = net profit of$30 000 000 this makes the loan look like peanuts, and they could produce 35-40 000 oz for the first six month of production, makes it look even better....
Hi Fastbuck, your point is absolutely on the money! That in fact RED will soon be producing gold, at considerable profit! (But of course thats what the modelling has been telling us all along, that RED is immensely discounted regardless of whether its some more equity raised, even at 20.5 cents, based on that production from Siana).
I've been thinking more about the additional funds that RED are getting as part of this funding package. I can see they are likely to vastly accelerate the exploration of Mapawa at the same time of Siana developing. There's going to be a considerable increase in the level of news flow (finally!), and my feeling is that RED will develop a market profile that belies its past failures and laggard tag! Any talk about it being a non-performer will be history with gold production and a huge exploration budget.
Ongoing news of Mapawa exploration will be a major contributor to how RED will be considered by the exploration industry, not just in Philippines, but internationally by major players, as well as in the investment market. That link you provided Fastbuck proves that the exploration industry is now already watching Mapawa closely, and with major corporates obviously sitting tight and quietly doing their sums about how much RED is worth - the involvement of insto's with large licks of shares makes RED an interesting corporate play, as the ideal exit strategy is for these insto's to facilitate such a takeover/merger, thus heightening the potential value of RED in the eyes of the market!
My advice to any small shareholders is don't get suckered into thinking that the immediate share price of RED will be the future of your investment return, its just the start, there is a considerable amount of time and activity to occur that will finally allow us to sit back as comfortable shareholders in a strong, emerging gold producer, much like the success that Medusa has already achieved.
Don't let any knockers and doubters of RED cause you to miss out on that exciting upside, that in fact we have all been waiting for and expecting in recent years. Those doubts are a fading and soon be a passing sideline to RED's exciting future IMO!
I've been thinking more about the additional funds that RED are getting as part of this funding package. I can see they are likely to vastly accelerate the exploration of Mapawa at the same time of Siana developing. There's going to be a considerable increase in the level of news flow (finally!), and my feeling is that RED will develop a market profile that belies its past failures and laggard tag! Any talk about it being a non-performer will be history with gold production and a huge exploration budget.
Ongoing news of Mapawa exploration will be a major contributor to how RED will be considered by the exploration industry, not just in Philippines, but internationally by major players, as well as in the investment market. That link you provided Fastbuck proves that the exploration industry is now already watching Mapawa closely, and with major corporates obviously sitting tight and quietly doing their sums about how much RED is worth - the involvement of insto's with large licks of shares makes RED an interesting corporate play, as the ideal exit strategy is for these insto's to facilitate such a takeover/merger, thus heightening the potential value of RED in the eyes of the market!
My advice to any small shareholders is don't get suckered into thinking that the immediate share price of RED will be the future of your investment return, its just the start, there is a considerable amount of time and activity to occur that will finally allow us to sit back as comfortable shareholders in a strong, emerging gold producer, much like the success that Medusa has already achieved.
Don't let any knockers and doubters of RED cause you to miss out on that exciting upside, that in fact we have all been waiting for and expecting in recent years. Those doubts are a fading and soon be a passing sideline to RED's exciting future IMO!
Hi all, hope everyones been keeping well, in anticipation of Wednesday, if not before...
Lets look at the big picture here without going into too much detail...
The Siana Gold project in the Phillis, has now got a finance package in place, a COMPELLING, short term, $25 million gold prepay finance package. THE SIANA GOLD PROJECT IS NOW GOING AHEAD, FROM EXPLORER TO PRODUCER !!!
Now lets look at MAPAWA, there has been a further $20 million, quarantined, for an accelerated exploration programme at MAPAWA. What have they discovered??? What is under that RED earth??? Is Mapawa the next Siana. Yes, but times it by TEN. When are they going to scratch the earth at Mapawa, who knows, but as Beatle said, where going to start getting info fairly rapidly as we are starting to have more projects on the go, accelerated projects... Just my thoughts...
Regards Moit
Lets look at the big picture here without going into too much detail...
The Siana Gold project in the Phillis, has now got a finance package in place, a COMPELLING, short term, $25 million gold prepay finance package. THE SIANA GOLD PROJECT IS NOW GOING AHEAD, FROM EXPLORER TO PRODUCER !!!
Now lets look at MAPAWA, there has been a further $20 million, quarantined, for an accelerated exploration programme at MAPAWA. What have they discovered??? What is under that RED earth??? Is Mapawa the next Siana. Yes, but times it by TEN. When are they going to scratch the earth at Mapawa, who knows, but as Beatle said, where going to start getting info fairly rapidly as we are starting to have more projects on the go, accelerated projects... Just my thoughts...
Regards Moit
Good evening Moit and fellow RED club members,
I will be traveling and out of contact for the majority of the next couple of days so i hope that RED has a full 2 days TH before putting out any future statements regarding the financing arrangement. So please don't interpret my absence as being anything out of the ordinary, I remain fully committed to posting on RED wheneven I feel i have something to add.
One final word regarding the opening price for RED once it resumes trading, whenever that is - I believe that the insto's will be trying to lighten the activity for the immediate days after resuming trading, due to the possibility that some weak holders may want to drop shares, and they will be most happy to pick up any loose stock. If that tactic does not bear much fruit, then expect to see the price being forced higher by any insto that might want to join the growing crowd. IF YOU ARE A COMMITTED long termer in RED I suggest its a danger to think that you will pick your shares back up easily at a cheaper price if you drop them now - I wouldn't want to be caught short, as once the finance is set in stone, then its only a matter of when the insto's want to make their moves before RED is re-rated upwards in line with the fundamental value.
Good luck to all RED holders. If I can borrow a well worn phrase which is my own personal investment strategy for RED: sit tight and "keep the bas***ds honest"!
I will be traveling and out of contact for the majority of the next couple of days so i hope that RED has a full 2 days TH before putting out any future statements regarding the financing arrangement. So please don't interpret my absence as being anything out of the ordinary, I remain fully committed to posting on RED wheneven I feel i have something to add.
One final word regarding the opening price for RED once it resumes trading, whenever that is - I believe that the insto's will be trying to lighten the activity for the immediate days after resuming trading, due to the possibility that some weak holders may want to drop shares, and they will be most happy to pick up any loose stock. If that tactic does not bear much fruit, then expect to see the price being forced higher by any insto that might want to join the growing crowd. IF YOU ARE A COMMITTED long termer in RED I suggest its a danger to think that you will pick your shares back up easily at a cheaper price if you drop them now - I wouldn't want to be caught short, as once the finance is set in stone, then its only a matter of when the insto's want to make their moves before RED is re-rated upwards in line with the fundamental value.
Good luck to all RED holders. If I can borrow a well worn phrase which is my own personal investment strategy for RED: sit tight and "keep the bas***ds honest"!
Good morning RED clubhouse members, I note Sprott were formerly strong supporters of MML, but appear to have sold down or exited that position a little while back. So they are well versed in the Phils. The point is that they have already made a packet from MML, and are clearly looking to repeat this with RED. It would seem to me that as time goes along we might see RED being listed elsewhere, Toronto for example, and maybe London too. Timing may be after gold production gets going. If this occurs then we will see further strong support for RED as overseas investors are not as tardy about the Phils as many Australian investors appear to be. AB
- Joined
- 19 May 2010
- Posts
- 293
- Reactions
- 1
Hi Anderbond, I've noticed that the ASX significantly undervalues South African mining assets, are there any other geopolitical areas that are discounted illogically?
I've done lots of research on the political arena of South Africa (got a few shares based primarily in SA, makes it easier to stay calm when people are sh#tting themselves at the prospect of nationalization, even though the chance of it happening is about 1%, and even then they'd have to pay compensation for it).
Does the ASX just undervalue any companies based in foreign lands (too much effort to research??) or are there other countries that I should take a look at for discounted assets (e.g. the discount far outweighs any real political risk).
I've done lots of research on the political arena of South Africa (got a few shares based primarily in SA, makes it easier to stay calm when people are sh#tting themselves at the prospect of nationalization, even though the chance of it happening is about 1%, and even then they'd have to pay compensation for it).
Does the ASX just undervalue any companies based in foreign lands (too much effort to research??) or are there other countries that I should take a look at for discounted assets (e.g. the discount far outweighs any real political risk).
hi parle
this piece from 'lateline business' in august.................
BRIGID GLANVILLE: So does the company have an image problem? It seems to be - shouldn't you be at this point now where Kingsgate should be really taking off?
GAVIN THOMAS: Our franchise is the Australian Stock Exchange, and for better or for worse, Australian institutional investors don't really give a lot of credit to Australians operating offshore.
They bring a lot of political risk in, whether it be real or not. For example, the TSX has far differing views on Canadian companies operating offshore. We've shown that we're producing fantastic results, and in total returns over the last decade on the ASX 200, we are the third-best performer
this piece from 'lateline business' in august.................
BRIGID GLANVILLE: So does the company have an image problem? It seems to be - shouldn't you be at this point now where Kingsgate should be really taking off?
GAVIN THOMAS: Our franchise is the Australian Stock Exchange, and for better or for worse, Australian institutional investors don't really give a lot of credit to Australians operating offshore.
They bring a lot of political risk in, whether it be real or not. For example, the TSX has far differing views on Canadian companies operating offshore. We've shown that we're producing fantastic results, and in total returns over the last decade on the ASX 200, we are the third-best performer
Yep it's funny that you talk about SA, GDO is another one of my small specs who I see big potential in (like RED). They look great on paper but the market here seems to pass them over for the home based miners with smaller resource bases. They are already in production, are also in the final stages of a finance deal and have just doubled their resource base (announced today) yet the market really hasn't moved much....
- Joined
- 19 May 2010
- Posts
- 293
- Reactions
- 1
OT: Mr Hurricane I've just written up a review of GDO on my blog (sig for URL)! Nice timing . I also hold GDO, found them after doing some research into Baker Steel (someone mentioned they were excellent fund managers, Beatle I think, so I looked into it), and found GDO! Quite severely undervalued by the market as well (the "South African" effect, also taking place on CCC if you've got some time to look into it).
RED still in a halt, I'm still not quite sure what to make of the recent finance deal, I have a feeling that it's quite positive (WE HAVE A MINE!) but I'm not sure that the market will see it that way... I guess it's just me being a negative nancy, I think I'll hold on for a month or two longer and see what happens.
. I also hold GDO, found them after doing some research into Baker Steel (someone mentioned they were excellent fund managers, Beatle I think, so I looked into it), and found GDO! Quite severely undervalued by the market as well (the "South African" effect, also taking place on CCC if you've got some time to look into it).RED still in a halt, I'm still not quite sure what to make of the recent finance deal, I have a feeling that it's quite positive (WE HAVE A MINE!
) but I'm not sure that the market will see it that way... I guess it's just me being a negative nancy, I think I'll hold on for a month or two longer and see what happens.