BSR 0.00% 1.3¢ bassari resources limited

"Anyway from what I have read, HEG is flat broke, {if you can...

  1. 13,314 Posts.
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    "Anyway from what I have read, HEG is flat broke, {if you can believe that, } so the 100 million plus shares might be looking for a different home."

    HEG might be holding for years yet. They own in their own name, not through a nominee so if they sell any on market we would have to see a change in substantial holder notice.
    Until then its all speculation.

    For all we know, HEG might have a target price well above the value shown by the FS for the starter pits, ie well above 5c. Even 10c, diluted for the rights issue would only be a market cap of $138mill. That is not that much once they are producing and infill drilling to define a resource potentially in the 2-3mill oz range. ABU has a mc of around $121mill. They have a resource of around 750koz and will likely produce roughly 200,000oz from open pit and potentially more from u/g mining. They have more ounces in other deposits but those are not known to be viable yet and require studies as does the u/g mining potential. ABU has exploration upside but BSR appears to have stronger exploration upside based on current drill results for both companies outside of the existing mine plan. BSR's 171,000oz looks very much like a fraction of what they will recover from open pit. I like ABU but BSR trades at one sixth the mc of ABU with no good reason to trade that far below. 10c is certainly not far fetched in 1 year if producing by then.I think just a matter of time- The time required to get into production and use cash flow to start aggressive in fill drilling. In fact ABU has achieved its $121mill mc and it also is still in the development stage and with only an outdated scoping study- not a FS. ABU has much higher grade but margins are going to be similar thanks to much cheaper labour for BSR. I remember DRM also having a mc in excess of $100mill while still in the development stage. BSR has the FS and drill results (showing large upside to FS numbers) to also be able to reach a market cap in excess of $100mill before producing.
    Last edited by chuk: 29/07/14
 
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