Peregrine Diamonds Ltd. PGDIF

First Value estimate for KDI's bulk sample

[ekim]

Here is a first go at the KDI bulk sample diamonds:

4.22 carats -- white/colourless, transparent macle with no inclusions; (US$1300 per carat)
2.59 carats -- white/colourless, transparent dodecahedron with no inclusions.(US $1200 per carat)
2.63 carats -- white/colourless, transparent octahedral with inclusions; (US$1000 per carat)
2.79 carats -- light brown, transparent aggregate with minor inclusions; (US$400 per carat)
That totals US$12,340 total value for all 4 stones.

Now we have another 25 stones over 1 carat of some size. Let's assume an average of 1.75 carats each @ US$500 per carat for a total value of $21,875.

Stones above 1 carat in size give 56 carats @ US$610 per carat.

Now you have a total of 893 carats.

Spread the value above over the whole 893 carats and you get US$39 per carat.

Questions is what value does the 837 carats under 1 carat in size contribute to the value chain?

CH6 stones under 1 carat contributed US$77 per carat to that parcel. I'm guessing KDI will be lower in quality and also has a bunch of carats in that first sieve that CH6 doesn't.

So, let's go with US$40 per carat.

Result is a parcel value of US$75 per carat.

x 2 cpt and you still have rock value of US$150 per tonne.

This valuation model exercise that KDI is going through will probably not be a deal breaker like NAR went through. The upper range of the resultant model should still have some profit margin to it. Not sure of the minimum though. That may be tight.

As above, I'm predicting the top 4 stones to have a combined real value of $12K.

CH-6 bulk sample had 1 stone worth $36K and it wasn't considered an outlier.

LONG...PGD

EKIM