Mineral Sec Share Discussion Threads

[utwiq] 08/11/2007 22:46

pillion - go for it

clearsoup - I don't know if the third is a valuation method, just a projection of possible value. Although maybe we can say that what we have here is a project generator, identifying and advancing projects, with much hidden value in the pipeline of projects and management expertise in advancing them and sourcing new deals, all underpinned (indeed more than that) by a massively discounted stake in a set of promising natural resource investments. You get value in a few ways. First, closing the discount. Second, leveraged appreciation of the investment portfolio (as in, your £1 buys you £2, the resoure market advances by 25%, your £1 is now worth £2.5). Third, progress on the unlisted projects (advancing Sappes would add up to £30-50m to my valuation; Loretta, up to £160m). And fourth, the unknown value of deal flow and the rest of the pipeline of projects.

[pillion] 08/11/2007 22:23

utwiq and clearsoup

Is it OK if I copy some of your posts to Hot Copper, an Ozzy Bulletin board ?

[clearsoup] 08/11/2007 21:04

I'm afraid it would not de-risk my speculations concering the value of Lady L, if I told you who I listened to!
Perhaps we are struggling with methodology: how to rationalise investment decisions about this interesting company. It has become more difficult post merger. One way is discount to NAV: your £2 for £1. Another is our header's "Scarborough Minerals SCRB delists to combine with Mineral Securities from Oz to form a mini mining house". A third, which I think I prefer is potential multi-bagger with limited downside. I struggle! Appreciate your thoughts.

[utwiq] 08/11/2007 17:55

clearsoup, may I ask where you've heard this (disagreement, Keith's view, etc.) about Lady Loretta? I certainly agree that the pipeline has real value, and managment certainly have the skills and judgment to advance projects successfully. But even setting that all aside, you basically get to buy £2 for £1. Amazing.

[clearsoup] 08/11/2007 17:29

We are looking hard where there is some light to see by (ie the market has attributed a value): but the real value may be 'in the dark'.
There is disagreement about Lady L. though I have heard that Keith Liddle (the main reason why I own this stock) believes that it may be worth more than the Snowden valuation: A$400m "preferred" - something to do with metallurgy. Zambezi could turn out to be another Platmin. Tianshan and Herencia are early and very early days. I really don't know enough about the others; still let's hear it for Mineral Sands, Vostok, the oil interests etc.
But look at the ones that the market has picked up on: Platmin, Buka, Copperco, NiPlats. Management has to be doing something right. If the stuff coming through inside the pipe is anything like the stuff that's coming out, then the Mittals will become richer and so will we.

[skyfoot12] 08/11/2007 15:31

pillion i agree, profit taking in nip,
might be a good idea to put in a scroll-bar to save a bit of space

[utwiq] 08/11/2007 14:55

yep, and it's wrong precisely because it doesn't note that 15% of the company is owned by the company - it is an anomaly arising out of the merger (where SCRB owned some of MXX and so was issued shares in the latter on merging) and I suspect it has led a lot of people to miss the extent of the discount here.

[pillion] 08/11/2007 14:51

Utwiq
I got the market cap from here



Good to see the wealthy Mittal gang hold 10%

[utwiq] 08/11/2007 14:50

97.54m shares in CUO, per the 1 August post-merger update note
and yes, NIP has been an amazing realisation of value

[pillion] 08/11/2007 14:44

Macca

We can expect profit taking with NIP

It's still the jewel though for MXX

Up from float price of A$20 cents in September

We sure can't complain about the investments that Robert de Crespigny has made for MXX

[utwiq] 08/11/2007 14:41

Thanks pillion. Two corrections (I think):

The MXX MCap is lower than £114.6m because a good number of the listed shares are, as a result of the merger, held by fully owned MXX subsidiaries. Effective shares in issue are 84.3% of the total outstanding, so 135.898m. MCap at 72p is £97.85m. This is all per 15 August 07; quite a few options will have been exercised since then...

The Copperco holding was 69.917m shares as at 19 July 07 but it has increased since to at least 76.9m (per MXX website) and possibly will be larger again soon (I don't have my spreadsheet to hand; CUO annual meeting was in part to authorise issue of about 2.5m shares to MXX subsidiares for debt discharge).

And one interesting note (from the FT): a Mittal family investment vehicle has built up a 10% stake in Platmin.

[skyfoot12] 08/11/2007 14:38

nip down 16 points from 127 to 111 = -12.6%

[pillion] 08/11/2007 13:12

Buka Gold going well in Oz

Now $A48 cents

57,730,000 fully paid ordinary shares

MXX own 58% -- 33.46 million shares = A$16 million

£7.2 million sterling

-------------------------------------------------------------
Copperco (CUO)

Mineral Securities Limited 69,917,893 -- 17.2%

407,619,978 shares 101 cents

MXX A$70 million = £31.24 million sterling
------------------------------------------------------------------
If we take the utwiq valuation of Platmin,
Post 252 = £76.16million

Buka Gold = £7.2 million

Copperco = £31.24 million

£114.6 million which is the Market cap of MXX today

[pillion] 07/11/2007 23:45

MXX 165 --- No change so far tonight

Sydney opened at 11 pm

[utwiq] 07/11/2007 23:34

pillion - certainly the general market weakness could take this down further;
CUO and other base/industrial investments may be especially vulnerable. We usually seem to follow PPN (which is sensible in a way), yet have lagged this last move, and the discount at present is the largest I've ever seen it. So there is downside protection and a really good reason for a move up. Plus annual results should be coming soon, with NAV calculations, as well, I hope, as news on Sappes, Loretta, Vostok... I do have ILU in the valuation (£1.73m), per information once available from Scarborough Minerals (effectively 0.4% of ILU, which has 233m shares; technically, we own 5% of a consortium that owns a larger amount or some such). Fair enough to be cautious of course, but now looks a good time to buy.

[pillion] 07/11/2007 23:12

utwiq
Aye MXX is grossly undervalued I agree

Today I almost topped up myself but got cold feet on account of the weakness of markets in general

It may get worse before it gets better



btw, do you have any Iluka Resources Limited (ILU in Oz) in your valuation ?

They are mentioned on MXX website -- doesn't say how many though

[utwiq] 07/11/2007 23:07

I'm a broken record, but this is still stupidly cheap. With the Dow sell off we'll probably take a hit in Oz tonight, but I now make post-tax NAV to be £1.43/share. Yes that is almost double the present share price. Note that Platmin, our largest investment by a long way, has climbed back a long way... The (gross) value of that one holding underpins 71% of our MCap (holding worth £76.15m against a MCap of £106.59m). I've bought more again this week.

[clearsoup] 07/11/2007 22:20

$orted! ASX chart much appreciated.

[skyfoot12] 07/11/2007 12:57

what a mess

[clearsoup] 07/11/2007 12:54

Better picture, but the data needs to be for ASX. Mind you the volume scale is a bit optimistic. It took three trades to fill a buy order of 17500, a while back!

[clearsoup] 07/11/2007 12:44

Yes, mr. oz 244, though larger-scale (time-wise) would really be the ticket. Thanks!
Have just seen your post Pillion (? Server problem). I own both ASX (for my ISA) and LSE stock, hard-core; and trade a bit, too. In the latter context, it is interesting to see v. short term price and volume data: 1 day or 1 week.

[clearsoup] 07/11/2007 12:43

Yes, mr. oz 244, though larger-scale (time-wise) would really be the ticket. Thanks!

[pillion] 07/11/2007 11:53

Will have a dekko later with bigcharts.com

Off out the noo

jal