GREY:NEVDQ - Post by User
Comment by
Notgnuon May 24, 2021 9:21pm
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Post# 33258186
RE:My comparison between Ivanhoe and NCU >>>
RE:My comparison between Ivanhoe and NCU >>>PS: the math is such that the higher the price of copper goes the better that the equation favours NCU. The converse is also true. If copper goes way, way down then Ivanhoes low cost protects them from outright failure $1.15 cost IVN versus $2.00 cost per pound for NCU
.....but if there is a change in government in the DRC 5 years from now then IVN could go to ZZZZEEEEERRRR ooooH
N
Notgnu wrote: I am guessing a 30% political risk factor (or discount on IVN) and that Ivanhoe's KK project represents 85% of IVN'S Enterprise Value (E/V)
*** Note: also that IVN'S adjusted portion of the project is $8.5 billion E/V for 40% of the overall production.
| | IVN @ 40% | NCU @ 100% | |
| Long term average copper production per year (uses 500,000 tonnes production) | 440 million pounds | 290 million pounds | |
| $4.60 copper less ($1.15 for IVN and $2.00 for NCU) all in cost per pound | $3.45 C/F | $2.60 C/F | |
| Long term avg annual free cash flow | $1.52 billion | $750 million | |
| IVN E/V X 85% for K.K. only | $8.5 billion | | |
| NCU E/V plus $1B to build the open pit | | $1.4 billion | |
| Cash flow factor 1:6 adjustment IVN to NCU | $267 million | $750 million | |
| DRC 30 year risk vs USA risk neg 30% | $187 million | $750 million | 4X |
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| Ivn = 4X as expensive | | | |
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Looking for factors to adjust this further to update it's accuracy if anyone has comments that are actionable.
Cheers,
Notgnu