Golconda Gold Ltd V.GG

New SeekingAlpha article on Galane, potential 15 bagger

[Geodan2]

SeekingAlpha "Buy Profitable And Future 110,000oz Miner Galane Gold For $26.6 Million, Comparison To $316 Million Pure Gold" https://seekingalpha.com/instablog/535947-darp-research/5648819-buy-profitable-and-future-110000oz-miner-galane-gold-for-26_6-million-comparison-to-316

 

This is how it starts:

Summary At .0812 a share Galane has a $26.6 Market Cap, sells for <1 Times Book, <10PE and has EV/EBITDA of 2.92, yet will be one of the fastest growing miners.
 

The Galaxy Project will grow from current 15,000oz to 43,000oz gold a year in 2023 then 60,000oz in 2025 and has an IRR of 1,051% and an AISC of $777.

They bought the ready to go Summit gold and silver mine with Banner Mill in New Mexico (100,000oz Au, 6,500,000oz Ag) with NPV of $96 million for $16 million.
 

How does Galane compare to similar production sized Pure Gold? Galane has 1/12th the mkt cap. Is this justified by other factors?

Galane Gold (GGOFF) is a gold miner with the Galaxy Mine in South Africa, the Mupane Mine in Northeastern Botswana and the Summit Gold/Silver Mine in New Mexico USA.

They had $49 million revenue in 2020 with $12.1 million positive EBITDA and have started an explosive growth period. In mining a 30% IRR (Internal Rate of Return) is considered good and 50% IRR as great. So when I saw that Galane Gold (GGOFF) had a 1,051% IRR on the Galaxy Project was all ears. It is the highest IRR have ever seen for any mine project or for that matter any oil project either.

 

One conclusion for 2022: So at 60,000oz and combined AISC will guess at $1100 (Mupane is a lot higher than Galaxy) and $1775 gold that would produce $40.5 million profit. And Galane is currently $26.6 million market cap? That is insanely undervalued. It is 0.6 PE for a high growth company. If we assign an 8 PE that is a market cap of $404 million or about $90 million more than Pure Gold is today. That is about a 15 bagger.

[bailey2]

It's a steal down here at this price. The ore is still there at Mupane. They spent extra money to replace old equipment etc, to upgrade the infrastructure. Do it now , or do it later.... Not worried about the final payment getting Summit going. Don't know if it could be a 15 bagger , but certainly looks like a pretty easy 2 or 3 bagger from here. And watch out if the price of gold and

[Geodan2]

Bailey, it may not 15 bag but if gold holds or goes higher think a 10 bagger is over 50% likley.  Their Q4 run rate likely in 40K to 50k oz rate with Galaxy Stage 1 in bag.  Know of no 40koz or larger gold miner selling for under $30 million anywhere.  If anyone does know of one, please post. Was just thinking about final Summit payment, would prefer debt or silver stream, not

[RHertig]

Added alot since it fell below .10 have 3.6% of funds invested here. A lot bigger position than I like but a really good risk/reward to me.