FML 2.70% 18.0¢ focus minerals ltd

On 25 June SFR/TLM announced the following (new discovery)...

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    On 25 June SFR/TLM announced the following (new discovery) intersection from their Doolgunna project

    16.5m @ 18.9% Cu and 2.1g/t Au from 409.5m (not true width). This sent the TLM share price from about 18cents to a 53.5cent close today (an increase in TLM's market cap of 131.5 million shares x 35.5cents/share = $46.7 million). TLM own 30% of the project so using the rise in TLM's market cap, the ASX market has valued this one intersection at $155.6 million.

    The current prices in $US for these metals are
    Cu $5568/t ($55.68 per 1%) contribution per tonne = $1052
    Au $1167/oz ($37.5 per gram) contribution per tonne = $79

    The value per tonne of the combined metals in the SFR/TLM intersection is $1131 meaning the intersection has a gold equivalent grade of $1131/$1167 = 0.96oz or 30.1g/t. OK the equivalent of 16.5m @ 30.1g/t from 409.5m (down hole). Remember the true width of this intersection has not yet been established and it has been valued by the market at $155.6 million.

    On 13th of April 2015 FML announced the following (new discovery) intersection from their Karridale project.

    8m @ 27.46g/t gold from 425m downhole (not true width).

    FML's market cap has not been re-rated at all.

    Given the true widths of both intersections are not yet known and the grades and downhole depths from both projects have similar tenor, it just goes to show how the market is incapable of properly ascribing value across different companies.

    I see it as opportunity myself.

    Eshmun
    DYOR
 
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