Tharisa Share Discussion Threads

[jon4567] 14/7/2021 12:27

This week's Mello Monday is available on YouTube. Tharisa presentation starts around 1:20. https://youtu.be/6zXAqpLs6Qc

[adamsmithfreetrader] 14/7/2021 11:50

Thanks Soto for the info on the founding Cypriot family. I note from the a/cs that the major shareholders are:

Shareholders holding 10% or more
Medway Developments Limited 109 627 006 39.87 40.83
Rance Holdings Limited 40 548 241 14.74 15.10
Shareholders holding 5% or more
FIL Limited 26 508 352 9.64 9.87
Fujian Wuhang Stainless Steel Co. Limited 19 419 920 7.06 7.23

Presumably the Cypriot family are behind one or more of these holdings?
I also note the Chinese presence. I'm sure they'd like to secure their supplies cheaply...?

[tigerbythetail] 14/7/2021 11:49

Hi AdamSmith!
As Sotolo writes, the family is an old Cypriot copper mining family who emigrated to South Africa. So it's home to them.
And I'm not sure that Bermuda or BVI, for instance, are more reputable (that's based on direct experience, the shonkiest banker I've ever met was located in the BVI). Cyprus is EU, and only has a bad reputation because of the number of Russian shell companies set up there (direct flights from Moscow and St. Pete, and no visa required). And Tharisa doesn't have any Russian money in it, at least, as far as I know.
So I think it will all settle down in a few days and this is a bargain. So I'm buying. Usual tactics - small buys over the next few days to "splatter" what is hopefully the bottom.

[sotolo] 14/7/2021 11:40

Tiger seems to be a lot of rioting in and around Joburg which is barely 70 miles away, and adamsmith the reason for Cyprus is that the company was founded by a Cypriot family who are still major holders. I think the price is also because very thin trading and the PE always goes very low as rhodium becomes toppy, in the expectation it will fall as it always has bringing the PE back to something more normal for a relatively illiquid aim share in a jurisdiction of great inequality, so prone to political problems or higher taxes etc

[adamsmithfreetrader] 14/7/2021 11:14

I keep having to look over the financials to reassure myself. Based on the last set of 6 monthly accounts the PE of this stock is mid single figures. That's bankruptcy territory except when you read the BS and the opposite is true.
Truly crazy pricing.
Does anyone think the Cyprus address has anything to do with the apparent mispricing and why Cyprus in the first place? Why not something a bit more reputable like Bermuda, BVI or Channel Islands. Familiarity with the location might help...?

[farnesbarnes] 14/7/2021 10:46

"more nervous investors" - rewrite as "mercenary market makers"

[tigerbythetail] 14/7/2021 10:33

I go with the riots as the explanation for the drop as well.
Bar some effect on road transport, I can't really see how this unrest (which is centred on Zulu areas) affects Tharisa's business. But more nervous investors will read the headlines and pull out their money.
IMO, it's something of an opportunity.

[ukgeorge] 14/7/2021 10:10

I think the drop might be more to do with the riots in SA, they shouldn't be affecting ths too much but might have impacted transport, which had already been flagged up in the latest results.

[otemple3] 14/7/2021 10:09

No, it was Monday and was very good. Nothing untoward that I saw

[sotolo] 14/7/2021 10:02

Was the Mello presentation yesterday, did anyone hear it? Was there bad news that would account for the price fall this am?

[sotolo] 14/7/2021 08:29

Yes my thought is always that if PGM’s fell to nothing (or just covering their allocated costs which I assume at maybe somewhere in the region of $1000 per ounce) then we would still be a decently profitable company on chrome alone with a PE around 10 and even better when Vulcan is on stream. So the PGM’s are all cream. Though it is hard to work out where costs truly are and where allocated - though not as bad as Hochschikd, with their gold and silver equivalent ounces done on out of date gold/silver ratios that make their figures quite opaqueand put off investors, of course imho

[tigerbythetail] 14/7/2021 07:59

Hi Sotolo!
To answer your question from the other board, the percentage of profit from chrome depends on how you allocate the costs of production. And it also depends on the ever changing prices of both chrome and PGMs.
But, as a really rough rule of thumb, I'd think 25% is a good number to start from.
Certainly, at $160/t Tharisa will be making good money from its chrome production. And when Vulcan comes online next year, both increasing output and reducing chrome production costs, this will only get better.
Of course the "star" act here is PGMs. But chrome is also a solid performer at current prices.

[sotolo] 13/7/2021 09:26

This morning 129.5 to buy, 128.05 to sell. As usual a very thin markets so 1.15% spread not bad. However as usual the trades are virtually all listed as sells on LSE, but as at 129.5 must be buys, attaching buy or sell to a deal seems entirely random and often almost all are erroneously listed as sells. RH is drifting up and at $19300 just above the June low which might be a good sign, the basket is now nearing $3300 up around 5% on last week, let's hope not a dead cat bounce but the turn. If anyone listens to the presentation tell me if there is anything new but I imagine not, it is amazing the share is so thinly traded given all the PR work management do and attempts to say it is so undervalued

[tigerbythetail] 12/7/2021 09:49

Contango!
You can buy at 130.0p and sell at 130.01p. Arbitrage that!
Anybody got any ideas what's going on. It's most u-Tharisa like for the market-makers to collapse the spread like this!

[davidosh] 12/7/2021 08:42

Just to remind all shareholders and prospective investors that Tharisa will be presenting at the Mello Monday webinar tonight at 5:30pm-9:30pm. There will also be interviews with Fund Manager, Philip Rodrigs and CEO of Tandem Group plc, Jim Shears.


Here is the full programme...

5.30pm Welcome and news
5.35pm Company presentation by CentralNic plc
6.15pm Interview with Philip Rodrigs, Raynar Portfoilio Management
6.55pm Company presentation by Tharisa plc
7.25pm Alan Charlton interviews Jim Shears, CEO of Tandem plc
8.00pm Company presentation by Immotion plc
8.40pm The Mello BASH – Richard Crow, Kevin Taylor and Jack Brumby


There are over 600 investors attending these very popular shows with company presentations, fund manager and investor interviews, and panel sessions including the popular Mello BASH (Buy, Avoid, Sell or Hold).

Tickets are still available and if you would like one at half price then enter the code MMTADVFN50.

[tigerbythetail] 11/7/2021 16:37

www.kitco.com/news/2021-07-09/South-Africa-s-Tharisa-increases-quarterly-platinum-group-metals-production.html

[martinfrench] 09/7/2021 11:58

mainjly pgm basket james, the next big ramp up will be from production improvements i think

[jamessmith23] 09/7/2021 10:38

Thanks both for the responses, I'm reading through the relatively recent stock pitch from stockopedia now as they often have some useful info in.There's obviously been a massive step up in profitably in recent quarters, how much of this is down to scaling up of operations and how much of this is down to price of the commodities? As one of these is a intrinsic driver of value and the other is external and could change at any time based on changing demand. Would also be interested to see how prices have reacted to inflationary pressures previously as that is part of the reason I have looked at CAML as another option, copper demand likely to increase and also a decent inflation hedge.

[tigerbythetail] 09/7/2021 10:13

Hi James!
Good luck with your research. FWIW, I think this share is very much worth the time and trouble. Stockopedia rates it 99/99, which I think is fair enough; it's an outstanding proposition.
1. Everybody seems to agree that the chrome market should grow by about 5% a year through the 2020, and that prices should gradually improve.
2. PGMs. It's worth looking at the regular market reports for PGMs that Heraeus and Johnson Matthey produce (they are the leading refiners). As regards automobile demand, EV adoption will be (a lot) slower than the hype says - there simply isn't enough lithium being mined for it to be otherwise, and also electricity supply is a big issue for many countries. Remember hybrid EVs actually use more PGMs than conventional ICE powered cars. Fuel cells - well, we'll see. I'm hoping that they become widely adopted for heavier forms to transport, such as buses, trucks, ships and maybe even planes. The hydrogen economy would use PGMs very heavily, both for hydrolysis and fuel cells. Note how the price of the minor PGMs iridium and ruthenium has boomed recently. They are key metals in this new world.

[martinfrench] 09/7/2021 10:06

james,

pgms other than rhodium do have some green demand, and the ev car boom is very far off, only 14 million ev cars vs 1.4 bill non ev last time i looked. conversion to ev is really quite far off.

chrome concentrate is used in steel making i believe, so as economies recover / expand due to public initiatives, that should increase

plus platinum should move in line with gold as another pure play, and historically the plat / gold ratio is a bit out of sync.

and the thing with tharisa is that they are incredibly efficient at what they do, so should always be one of the best in class.

[tigerbythetail] 09/7/2021 10:05

By the way. the Guardian is just reporting that the chip shortage has reduced UK car production by no less than 27% - that's a big number.
I assume it will be fairly similar all over the world. The chip shortage ending will make a big difference! (This should be a gradual process over the next six months).

[jamessmith23] 09/7/2021 09:44

What is the expected future demand for chrome concentrate and PGMs? A large amount of non EV cars use them but would expect PGM demand to reduce to them over time although also read they are looking at introducing them into EV vehicles?While the price of these commodities is high, if demand is to reduce in future obviously huge hit to the bottom line. Am doing initial research into the share and trying to form an unbiased view before buying in or not so any help appreciated.Thanks

[ukgeorge] 09/7/2021 08:49

PDF version.

"Optimisation programmes remain on track, with Vulcan construction completion by end
September 2021

The Company was successful in meeting its delivery obligations, despite continued inland logistical challenges in South Africa and limited shipping availabilities. Sea borne logistics costs continued to trend upwards"


So costs are rising with the strong rand, and increasing inland logistical and shipping costs. Countering that capex costs will soon start to drop. Encouraging to see 20% y/y and q/q growth in reef mined. Also they are using this time to do extra stripping of the mine so longer term will help costs. Also flagging that chrome ore prices should start to rise.

[tigerbythetail] 09/7/2021 08:07

Production results very strong, at first glance, IMO. They are as good as could be hoped. And, given this is mining with all its difficulties, that should never be taken as "expected".
Obviously, a lot of money this quarter has been poured into the capital investment required for Vulcan. We'll see the benefits of that in 2022 and beyond - increased chrome production at a lower overall cost per ton.
I note the company's optimism about the chrome market, and I share that.
I also believe the rhodium price will find a floor somewhere in the teens in the short term. As the chip shortage is resolved, and speculators leave the market, I expect supply to grow tighter over the next few months, and the price reverse and start to rise again. (But this won't be an overnight thing - think six months).

[sotolo] 09/7/2021 07:45

My view is it is just as expected so don’t expect share price to do a lot, though will begin to get influenced by Rh down further, but of course I am hopefully wrong