Largo Inc T.LGO

Revenue from battery sales/rentals

[st_esteban]

At the moment my biggest concern with Largo is not the trading volume or even management execution of the plan (although this is abig concern).  My biggest concern is the revenue that Largo will have in the short term from LCE vs revenue from sales of V.

From LCE there will be 2 streams of revenue.  One relates to the initial sale of the batteries and the second relates to the rental of the electrolyte.

Largo won't see any meaningful revenue from LCE from those two streams until:
1) - We have a large pool of customers buying those batteries (or small number of customers buying a lot of batteries)
2) - A steady production of the electrolite to make these batteries

We won't see any revenue until the batteries are delivered to the customers.  The customers might pay some of the up-front costs but this will go towards production costs for these batteries.  So even if we receive this revenue, it willtranslate into very little quarterly profits.

We have a dependency on the production of electrolyte to deliver on any sale and receive full payment for the battery and start receiving rental payments for the electrolyte.  My understanding is that the production of electrolyte depends on the completion of the V2O3 palnt.  The announced date for completion of the plant is early 2023. Am I missing something here?  can we produce the electrolyte without this plant?

If the above is correct we will continue to depend almost a 100% on the performance of Vanadium market.  The V market depends on steel production (90%).  This in turn depends on China which has been trying to cool down the metal market....

Based on the above I foresee Largo having a few more weak quarters and therefore there is ittle room for the share price  to go to the next level.

There are other factors to consider like the sale of iron ore but we do not have much visibility into what management is doing...

[kha341]

Thank god that V2O5 prices are moving upward everywhere.