Noranda Income Fund Unit NNDIF

Comparing valuations

[ZincDink1]

	Rev	MV	rev/MV
Noranda	854.2	42.4	0.05
Zhuzhou	18.9	3.81	0.20
Korea Zinc	7055000	7614000	1.08
Shenzen	27.4	16.96	0.62
Henan	17.9	6.72	0.38
Huludao	7.1	4.95	0.70
Yunnan	16.7	26.83	1.61
Baiyin	67	21.25	0.32
Yunnan luoping	1.6	2.22	1.39
Hindustand	201	1270	6.32

 Just thought I would compare values with other refiners. The closest in size is Zhuzhou, a new 300 Mtonne plant.

The figures I took are from Investing.com and in the local currency. So as you can see, by revenue over market value, Noranda is by far the cheapest.

	equity	MV/equity	Percent
Noranda	153.5	0.3	-24
Zhuzhou	0.2	19.1	11
Korea Zinc	6887443	1.1	8
Shenzen	11.9	1.4	23
Henan	3.6	1.9	47
Huludao	2.8	1.8	20
Yunnan	15	1.8	43
Baiyin	14.1	1.5	-5
Yunnan luoping	1.46	1.5	-2
Hindustand	366.4	3.5	114

Now if you look at market value over equity, Noranda again is significantly cheaper than anything out there. Most of the others have recovered in value since the pandemic but we are the only one down by double digits and actually down by more than 50 percent since the pandemic was called.

Seems we have a deep discount from Glencore throttling the company.

[ZincDink1]

Should note that you can't use the equity on the balance sheet as Glencore took massive impairment charges. MV/equity ratio is less than 0.2. Note that Zhuzhou recently close the old refinery and opened a brand new one, so they carry a lot of debt right now.

[Bwrbhk]

You are correct about the Glencore discount impacting Noranda's market valuation.  Glencore has an offtake agreement with Trevali based on benchmark TC's which are $300/tonne.  They also have an agreement with Noranda based on spot TC's which are currently $80/tonne.  The difference, about $220/tonne is pocketed by Glencore to the detriment of both Noranda and Trevali

[ZincDink1]

Not sure if there are any instituitions holding this. Few smaller groups, but who knows if they are still holding. We don't even know for sure what ther TC terms are...what is market conditions? Is it spot or based on spot or based on some complex number inbetween? All we know is revenue has gone down while zinc price has gone up. Guess we will find out soon enough if we continue under spot.

[Bwrbhk]

At the time of the last Information circular, May 11, 2020, Extract Capital owned  5,198,200 shares or about 13% of the issued shares.  There are no notices since that date that they have bought or sold any shares.  Because they owned over 10% of the class of shares, they would have had to report divestures and/or additions, so I assume that they still hold the shares. Regarding