Elephant in the room is dilution & country risk. Was c450m shares early Jan 23, shortly over 3bn & that assumes no more raises or acquisitions in 2025. The jewel in the crown was Karakubis &that campaign like the last 4 in Botswana has been very poor, the hope was a commercial discovery worth $50-100m to KAV but even if that does materialise it’s now worth 50% less per share due to latest raise. You have to be deeply sceptical about Turney’s production forecasts as zero track record but assuming your retained earnings calcs then EPS is minuscule due to dilution. The PE ratio for a non dividend paying company in Zim has got to be 0.7-2.0, even Turney recognises this. Hence my analysis (despite the 0.7p fund raise) is that KAV is worth significantly less when valued like any other company. The balance sheet really is bollocks.
Country risk is real. Zim has no real currency other than USD & no access to debt funding hence all funding for the mine/production has been equity i.e. 3bn shares in issue. Zim govt announced it now wants 25% free carry for new mines, sketchy details & might not impact current plans but it’s the direction of travel. BT was named in an affidavit in Zim, the details are available in Zim press via Google, they are not flattering! Then you have everyday Zim issues like electric supply, draught, theft, machete gangs & endemic corruption.
Geological risk is significantly less in Zim than Bots but KAV have found a lot less gold than original estimates. Really can’t see 1m oz resource at Hillside from assay results, more likely 100k.
Investors could probably live with a lot of these issues if the risk reward ratio were sufficient & dilution was under control. But, given these issues can anyone point to a 5 or 10 bag upside?
"The jewel in the crown was Karakubis &that campaign like the last 4 in Botswana has been very poor"
>> Poor, based on what evidence?
"the hope was a commercial discovery worth $50-100m"
>> How do you know it is just this value?
"to KAV but even if that does materialise it’s now worth 50% less per share due to latest raise."
>> Even $50m is worth 1.3p per share - 2X today's share price or $100m is 4X today's share price.
"You have to be"
>> Do you, why?
"deeply sceptical about Turney’s production forecasts as zero track record"
>> Not true.
"EPS is minuscule due to dilution."
>> Forecast 1H26 earnings of £2.44m would be 0.13p earnings on a 0.63p share which is a P/E of 5. Why is that miniscule?
"The PE ratio for a non dividend paying company in Zim has got to be 0.7-2.0"
>> Why does it "HAVE" to be?
"even Turney recognises this. Hence my analysis"
>> Where is your analysis?
"Zim has no real currency other than USD"
>> Not true. It has the ZiG
"& no access to debt funding"
>> Not true. Zim is currently negotiating with lenders, the world bank and the IMF.
"hence all funding for the mine/production has been equity i.e. 3bn shares in issue."
>> Not true. Refer to past KAV RNS - funding has been loan notes until the strategic fundraise.
"Zim govt announced it now wants 25% free carry for new mines, sketchy details & might not impact current plans but it’s the direction of travel."
>> It's not 25% it's 26% and nothing has been officially announced yet and nor whether it will affect existing mines, and even if so how it then affects corporation tax and royalties. All in all it might mean a higher or might mean a lower tax bill. But the direction of travel is ZIM want - and need - to grow mining exports.
"Really can’t see 1m oz resource at Hillside from assay results, more likely 100k."
>> Where's the evidence for that?
"can anyone point to a 5 or 10 bag upside?"
>> Yes. And even *you* point to a 2X - 4X upside when you speak of a $50m-$100m potential return from just one asset!
Thank you for sharing your research, I invested in KAV a number of years ago, like you I think 2025 will be the start of the uptick despite the challenges
Elephant in the room is dilution & country risk. Was c450m shares early Jan 23, shortly over 3bn & that assumes no more raises or acquisitions in 2025. The jewel in the crown was Karakubis &that campaign like the last 4 in Botswana has been very poor, the hope was a commercial discovery worth $50-100m to KAV but even if that does materialise it’s now worth 50% less per share due to latest raise. You have to be deeply sceptical about Turney’s production forecasts as zero track record but assuming your retained earnings calcs then EPS is minuscule due to dilution. The PE ratio for a non dividend paying company in Zim has got to be 0.7-2.0, even Turney recognises this. Hence my analysis (despite the 0.7p fund raise) is that KAV is worth significantly less when valued like any other company. The balance sheet really is bollocks.
Country risk is real. Zim has no real currency other than USD & no access to debt funding hence all funding for the mine/production has been equity i.e. 3bn shares in issue. Zim govt announced it now wants 25% free carry for new mines, sketchy details & might not impact current plans but it’s the direction of travel. BT was named in an affidavit in Zim, the details are available in Zim press via Google, they are not flattering! Then you have everyday Zim issues like electric supply, draught, theft, machete gangs & endemic corruption.
Geological risk is significantly less in Zim than Bots but KAV have found a lot less gold than original estimates. Really can’t see 1m oz resource at Hillside from assay results, more likely 100k.
Investors could probably live with a lot of these issues if the risk reward ratio were sufficient & dilution was under control. But, given these issues can anyone point to a 5 or 10 bag upside?
"The jewel in the crown was Karakubis &that campaign like the last 4 in Botswana has been very poor"
>> Poor, based on what evidence?
"the hope was a commercial discovery worth $50-100m"
>> How do you know it is just this value?
"to KAV but even if that does materialise it’s now worth 50% less per share due to latest raise."
>> Even $50m is worth 1.3p per share - 2X today's share price or $100m is 4X today's share price.
"You have to be"
>> Do you, why?
"deeply sceptical about Turney’s production forecasts as zero track record"
>> Not true.
"EPS is minuscule due to dilution."
>> Forecast 1H26 earnings of £2.44m would be 0.13p earnings on a 0.63p share which is a P/E of 5. Why is that miniscule?
"The PE ratio for a non dividend paying company in Zim has got to be 0.7-2.0"
>> Why does it "HAVE" to be?
"even Turney recognises this. Hence my analysis"
>> Where is your analysis?
"Zim has no real currency other than USD"
>> Not true. It has the ZiG
"& no access to debt funding"
>> Not true. Zim is currently negotiating with lenders, the world bank and the IMF.
"hence all funding for the mine/production has been equity i.e. 3bn shares in issue."
>> Not true. Refer to past KAV RNS - funding has been loan notes until the strategic fundraise.
"Zim govt announced it now wants 25% free carry for new mines, sketchy details & might not impact current plans but it’s the direction of travel."
>> It's not 25% it's 26% and nothing has been officially announced yet and nor whether it will affect existing mines, and even if so how it then affects corporation tax and royalties. All in all it might mean a higher or might mean a lower tax bill. But the direction of travel is ZIM want - and need - to grow mining exports.
"Really can’t see 1m oz resource at Hillside from assay results, more likely 100k."
>> Where's the evidence for that?
"can anyone point to a 5 or 10 bag upside?"
>> Yes. And even *you* point to a 2X - 4X upside when you speak of a $50m-$100m potential return from just one asset!
Thank you for sharing your research, I invested in KAV a number of years ago, like you I think 2025 will be the start of the uptick despite the challenges