Serabi Gold Share Discussion Threads

[trader365] 05/3/2020 20:17

Narrow vein miners are seen as high risk, they typically have significant changes in grade affecting their structural and grade continuity. The dip angle and dip direction is highly variable, as is the vein itself. Veins narrow and widen along strike which give huge swings in grams per ton and therefore can result in large quantities of waste rock being mined. The consequences of getting it wrong can be disastrous for a company. This is what happened to SRB in the early 2000's. The market remembers and is very unforgiving, hence the low valuation assigned to SRB today.

[ppvn] 05/3/2020 19:33

Financials for q4 (and thus FY2019) will be out at the end of the month, potentially in addition to news from the Coringa license. Would expect both of those to have a very positive impact tbh.

[tiger60] 05/3/2020 18:53

The problem is the rerating should already be happening but isn’t. Although we have seen small gains versus huge losses on other equity sectors we are not seeing the dramatic movements I was expecting, especially as the number of shares in issue is very small. I picked this share partly based on its illiquid nature.

Not sure if it is lack of market recognition of this company or paralysis of action by investors. Hopefully with gold again rising near to new highs we will see some reward. We need market awareness. We need volume.

[morethanme] 05/3/2020 17:44

If US rates get to 0% or close to this year, we will also have investors reconsidering their bond allocations in portfolios and maybe making a move to a portfolio with a higher % of gold, which is currently very low by historical standards.

[morethanme] 05/3/2020 17:15

Some of the valuations of gold stocks definitely comes down to sentiment and over the last 7 years, gold stocks have been out of favor. If you look at the returns of tech stocks in the same period and how much the POG dropped from 2013, it is not surprising. You also had the commodity crash in 2015/2016. The gold mining sector has not been a popular investment for this period and it is why they have such low valuations.

Imagine how much this sentiment will change if the POG were to make an ATH in USD. Gold mining stocks would see investors flooding into the space, when they see the value on offer. That is why I invested in this area, I think sentiment change towards the gold mining sector will be one of drivers for more favorable valuations.

[trader365] 05/3/2020 16:29

Here's a young Hodgson touting the company in 2013 & 2015



Progress has been slow over the 7 years, the only major change has been the colour of Hodgsons hair and the size of his bank account, neither of which has any benefit to shareholders...

[tightfist] 05/3/2020 16:06

Hi WG,.Pardon? Current SRB FY guidance mid-point is 45,500Oz or $75m at current PoG. All in a company with a £51m MC.....More likely is people taking the easy and supposedly liquid route of ETF investing in diverse large market caps?.Cheers, tightfist

[whitegold1] 05/3/2020 14:52

Thought there.d be more strength. Guess it.s the producers who benefit from the current mkt seesaws.

[borisjohnsonshair] 05/3/2020 14:05

I'm around until 500p. It's not a time thing, although that's a when!!

[tightfist] 05/3/2020 14:02

I am positive but sceptical: IIRC they have been really good on Budget control but weak on Timing - and it's not only regarding the OS!

[tightfist] 05/3/2020 13:58

Hi Tiger,.I generally agree - PoG is our ally. IMO MH has the Best Will in the World but his track record on hitting timings shows they are often 30-40% optimistic. Lots of wild cards surround Tapajós. But also most other global locations for Gold extraction are fairly hostile, hence the serial underachivement?.Having started invested in SRB and posting here for over 6 years, I expect to still be here in 2 years time!.Cheers, tightfist

[ppvn] 05/3/2020 13:54

You're right to be cynical - but Serabi have been successful in opening up both Palito and Sao Chico on a shoestring budget.

Whilst progress has sometimes been less quick than anticipated (ore sorter anyone?!) - the mines themselves have been developed quickly, safely and on a very good budget. Not saying it's not possible things go wrong at Coringa, but serabi do have a great track record with regard to opening up small mines imo.

[tiger60] 05/3/2020 13:44

I will stick my neck out and say nothing from Coringa 2021. I know, I know I can hear the rebuttals but judge me in 2 years - if anyone is still around. I have been in many miners and worked on many non mining related projects (banks)and very few (and I mean very few) hit their own self imposed deadline. We all want the optimum result and that is what is pitched from the board down but rarely happens.

The value here will be gained by the increasing profit margins caused by a rising POG rather than enhanced production figures for 2021 but that in itself will be enough to lift this to new highs

I used to be invested in a Diamond producer many years ago. They had this amazing ore sorter - 'ring any bells' - well it was great but the production figures forecast and what actually happened was very different. Then came a flood and the end of the story. The diamonds were in the ground and plentiful but getting them out was funnily enough not as easy as the company said - don't know why I am throwing that in, probably to show I have become cynical with age....

[tightfist] 05/3/2020 13:36

Hi Tiger60,.Yes, I am bullish PoG too. Referring to your production musings, we have IIRC this year's Guidance for 45-46kOz, that presumably factors in Q2 for the OS going on-line. It possibly also reflects the H2 run-down of Tailings re-treatment, which we must also remember..I think MH has suggested a 2020 exit rate of 50kOz pa for PC alone. I suggested a while back 16kOz during H2 2021 from Coringa ramp-up but do I now get the feeling that the company has been soft-peddling expectations on timing since the PEA publication?.Patience! Cheers, tightfist

[morethanme] 05/3/2020 13:33

This year is definitely going to be a volatile one, that is for sure!

[tiger60] 05/3/2020 13:28

Even the Yen has been deserted by those seeking sanctuary the dollar is still king but who knows with the market tanking and a shift in thinking away from a trump landslide things could get interesting, especially if Bernie makes a comeback.

The only certainty is Q1 profit figures will be dire. The markets may bounce around for a while but there is no stopping the trend. It is not pretty

[morethanme] 05/3/2020 13:23

Completely agree, all central banks will cut, but some have more room to cut than others. USA starting 2020 with 1.75% vs BoE with 0.75% vs ECB with 0%.

I expect by the end of the year to have rates change by:
- BoE 0.75% => 0.25% (-0.5%)
- USA 1.75% => 0.5% (-1.25%)

[tiger60] 05/3/2020 13:11

Well it is only a matter of time before BoE follow suit - it is a given

[morethanme] 05/3/2020 13:06

With the Greenstone $12m convertible loan based on USD$1.30/GBP£1.00, we will get:
- less shares issued if the GBP strengthens vs the USD
- more shares issued if the GBP weakens vs the USD

The US fed had an emergency 0.5% rate cut this week and further rate cuts (0.25% or 0.5%) are priced in by the market for the 18th of march meeting. So it looks like the US fed will support their markets in any way they can, especially with it being an election year. I think this could lead to the USD weakening.

I know Greenstone are many times smarter than myself, but they committed to the convertible bond before the market chaos and emergency rate cuts.

Does anyone have an opinion about the outlook of the GBP/USD and if Greenstone will benefit or lose out with the currency fluctuations?

[borisjohnsonshair] 05/3/2020 13:02

You say at most 50,000. We are clearing US$500 / ounce, so US$25M. Hardly only.

[loganair] 05/3/2020 10:56

Price of gold at another all time high in local BRLs at 7,546BRLs, that's up 53% over the past year.

[tiger60] 05/3/2020 10:11

Thanks for the replies - seems a big disparity between the two markets. I am still bullish on gold - can see nothing in the short or long term to stop a rise up to new highs.

I presume 2019 results will be published soon and we can get a look at Qtr4 figures plus overall PnL.

I know a lot on here are bullish regarding Production but at most we will get 50,000 this year (baring natural interventions - flooding, virus - other risks: strikes etc)and as to 2021 if Coringa isn't online until end of 2021 as per the presentation I can't see it adding much more for that year. Remember there is a lot of work to be completed to get it online plus extra funding and builds rarely go to schedule.

That said it is currently undervalued but it must get its resource statement up and this year (with a rising gold price) should see PNL move from circa GBP 3m for this year up to maybe 5m (very arbitrary atm).

Once the resource update is completed, Coringa is signed off and the process begins I think it is more likely that a major will step in if they see a potential site with a resource base stretching years set against high gold prices. Otherwise we will see multiples on the share price (if everything goes according to plan) the nearer Coringa comes online

[tightfist] 05/3/2020 09:58

Weird, posts #5550 and #5551 were shown as Sherry - now posted by Cotton and Loganair!!