Rare earth elements continue to fly largely under the radar of the investment community.

The reason being that they're used in traction motors of EVs, and not the ever-discussed batteries.

The key REE, Neodymium, is now up 376% since 1 July '20.

Valuation check on #MKA ⬇️

@MkangoResources is due to complete its bankable feasibility studies for each of its rare earths mine in Malawi (Songwe Hill), and its separation plant in Poland, by the end of next month.

Details have been scarce, but #MKA has indicated the intended output of the...

...mine and separation plant - which is more than double that of the output suggested in the 2015 pre-feasibility study.

Presumably with a little guidance from #MKA mgmt, @MkangoResources' broker provided some very basic headline numbers of how the integrated operations...

...may turn out.

The ARC analyst has used a basket sales price of $42/kg. In the 2015 PFS, #MKA had used a basket price of $59.8/kg.

Given the very powerful moves over the past 20 months of the key 'magnet rare earths' (neodymium, praseodymium, terbium, dysprosium)...

...which make up the large majority of the basket price at #MKA's Songwe Hill, I decided to run a quick exercise using current REE spot prices, provided by Kitco.

Needless to say, @MkangoResources will not be using these ridiculously elevated...


..prices in the feasibility studies. But equally, I think it highly unlikely that the BP will be as low as ARC's quoted $42/kg.

So here's current spot prices (at bid), dropped into ARC's model. Current Kitco pricings suggest a basket price for #MKA's Songwe Hill of ~$79/kg.

Even a 25% discount to current spots, suggests a BP of ~$60/kg.

At current spots, the integrated Songwe Hill / Separation Plant would be generating in the region of $400m EBITDA per annum, on revenue of $500m.

Total capex? ~$350m.

#MKA's current mkt cap? $76m.

Project life 15-20 years; but I believe that this could be extended significantly, using satellite deposits.

Geopolitics (esp. concerning US and China) only look to be going one way.

Deposits like Songwe Hill - of which there are very few worldwide - will be fought over.


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More from @MylesMcNulty

Feb 16
@PetraDiamondsIR #PDL is now at 96p / £186m and threatening to break out. It's in touching distance of the post-restructuring, intra-day high of 97.5p, with blue skies above.

Interim results are due out next Wednesday.

A basic summary of the investment case ⬇️

#PDL is a diamond miner, with interests in 4 mines:

3 underground mines in South Africa (all 74% owned), namely: Cullinan, Finsch, and Koffiefontein;

1 open pit mine (75% owned) in Tanzania, named Williamson.

The mines were all acquired from @DeBeers between 2007-11.

The mines had all suffered from underinvestment when owned by @DeBeers. As such, between 2006 and 2019, #PDL invested approximately $1.6bn in improving the operational efficiencies of the mines and in extending their lives.

Much of this came in the form of debt...

Read 25 tweets
Jan 28
The contrasting opinions on @avacta's valuation on FinTwit is fascinating.

Those who think #AVCT is overvalued, just can't seem to get their heads around the possibility that a £250m British biotech could be on the cusp of revolutionizing cancer treatment.

The bull case⬇️

#AVCT has four platform technologies:

1) Affimer Diagnostics
2) Affimer Therapeutics
3) pre CISION
4) TMAC (a combo of 2+3)

The purpose of this thread is to focus on and explain pre CISION and its potential value. This is the greatest near-term value driver for @avacta.

pre CISION - what is it? The most basic of explanations would be:

"Chemotherapy with dramatically reduced side-effects."

Chemotherapies are highly effective treatments for cancer, and have been used for decades. The issue with them, however, is that their effects are...

Read 26 tweets
Jan 17
There are so many ways to arrive at the conclusion that #AVCT's valuation is nonsensical.

Another, beyond the below, is to look at #APTA - owner of a first generation antibody mimetic platform, Aptamers - that recently listed on AIM.

On Friday it surpassed £100m mkt cap. 1/14
For each of its past two FYs, #APTA has generated no more than £1m in revenue.

The Affimer platform is a next generation antibody mimetic platform. It was "engineered to overcome many of the problems associated with aptamers or with antibodies". ⬇️


To my knowledge, #APTA (or its partners) has not put in place manufacturing capacity of 30+ million per month to sell propreitary, Aptamer-based SARS-CoV-2 LFTs.

#AVCT has.

So @avacta not only possesses a next gen., superior antibody mimetic platform; but from it has...

Read 14 tweets
Jan 14
@PapaDoc3333 @TrivChannel Thanks Malcolm, very kind.

The air of failure surrounding #AVCT this week on Twitter and the bulletin boards - largely from non- and ex-holders - is truly mystifying.

We will have a very good idea of whether the pre CISION platform is working, in the coming few weeks…

@PapaDoc3333 @TrivChannel …either from dose escalation in AVA6000 P1a; or from candidate selection for AVA3996.

One vital, silver lining of #AVCT’s RNS on Monday:

Alastair Smith has made it very clear that he is a man of integrity. He could have allowed M19 to continue selling MeduFlow in the EU, 2/n
@PapaDoc3333 @TrivChannel … and continue with their application to the FDA for EUA (home-use) in the US - whilst improving the strip simultaneously in the background.

All other LFT providers are doing this, after all.

The fact that AS didn’t tells us two things:

1) he will inform the market of…

Read 6 tweets
Dec 2, 2021
I came to appreciate long ago that AIM is an inefficient and irrational market.

But the share price of @avacta this week takes the biscuit. Following Monday's RNS, I was convinced we'd be at ATHs by now.

My explanation for what I think the market is missing on #AVCT ⬇️

On Monday, #AVCT announced that it had received FDA approval for its Investigational New Drug ('IND') application, to expand its Phase I clinical trial for AVA6000, into trial sites in the US.

The timing of the submission and the length of review are critical.

The FDA has a 30-day review and turnaround time. Given #AVCT announced the approval this Monday, owing to LSE disclosure laws we must assume it received the approval sometime between Friday and Sunday.

Give a few days for post / admin / comms delays, and we can assume...

Read 25 tweets
Dec 2, 2021
Happy with @Tirupatiuk's H1 results. The growth rate really is incredible, despite not being reflected to a great degree in the financials (yet).

When the acquisition of TSG completes (subject to Reserve Bank of India's approval), #TGR takes off.


Firstly, #TGR's upstream mining operations.

The very small 'proof of concept' Sahamamy plant - 3,000t pa.

It only operated at 2/3 of nameplate capacity in H1 (1,060t produced; 950t sold) owing to various Covid restrictions.

Even so, it achieved a gross margin of 54%.

The second plant, Vatomina, is three times the size, at 9,000t pa. It came online this Q.

A third plant, Sahamamy 2, is now under development, and is coming online within 6 months. It will have capacity of 18,000t pa.

#TGR's nameplate capacity as at 01.07.2022: 30kt pa.

Read 20 tweets

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