Post by
nozzpack on Jun 27, 2024 5:20pm
Valuation of LGC for FDP + Butia + Cerritos
I use Gmin as an excellent valuation proxy for Brazil.
Gmin has a market cap of $860 million.
It has net debt of $65 million which makes its enterprise value of about $925 million.
From this we must remove the added value of the mine whose Total expenditures were $456 million.
This leaves us with a basic valuation of about $470 million prior to building its mine.
Gmin has Measured and indicated Resources of 2.05 million ounces and less than 30,000 ounces in Inferred.
So we have $470 million divided by 2.08 million ounces which is about $225 per Ounce .
Butia and Cerrito have 1 million ounces.
Including extensiinal driiling additions by recent drilling at Butia and using Butia to estimate FDP volumetric comparisons, a value close to 2 million ounces can be arrived at for FDP, Butia and Cerrito.
At $225 per ounce using Gmin pre mine construction value of $225 per ounce, LGC will be valued at $450 million once FDP confirms its current Resource estimates.
This should happen late next week when all FDP new drilling additions are included in the resource estimate .
Should that confirm up to 1 million ounces at FDP, LGC would have a good proxy valuation of about $8 per share .
This of course excluded the additional 3 .5 million strike north of Butia shown by soil anomalies and drilling, nor any of other assets Including a massive VMS discovery at Matilde and Matilde extension.
So, the Journey up the charts here is just beginning .
Possibly next week, FDP will report and that should confirm our initial estimates that Butia and FDP could contain 1.5 million ounces or more..