Tiger Resource Finance Plc

Tiger holders may be interested in reply that I posted over at Stockhouse recently, regarding other companies mining in the same area...



valueguy1,
Can’t help with other companies apart from Polymet Mining, since I have been watching them for some time – and the comparison is so easy and so compelling.

Franconia value per share could be Cdn$8 or higher instead of yesterday’s close share price Cdn$1.50.

Using NPVs, at comparable prices, as explained earlier:

Franconia – US$ 300 million divided by 43,150,120 shares issued and outstanding, gives value of around US$7 per share (Cdn$8). FRA closed yesterday at Cdn$1.50.

Polymet Mining – US$ 161 million divided by 119,378,876 Current Issued & Outstanding Shares gives value around US$1.35 per share (Cdn$1.55). POM closed yesterday at Cdn$3.56.

Am convinced that both companies are excellent investments: Polymet who are less risk are closer to production (2008), but Franconia offer a lot more upside potential

The NPVs above use lower metal prices and I believe that metal prices will be a lot higher than these prices over the mine periods. At higher metal prices (09/06) , FRA have shown NPV of US$1.7 to US3.1 Billion Dollars (before tax), depending on Discount Rates. At different prices, POM have shown NPV of US$595 to US$873 Million Dollars (after tax), depending on Discount Rates.

Extract from earlier post 10/20/2006 comparing NPV figures:



Franconia’s NPV, (that’s value of metal after taken from the ground), with better grades, seems to be nearly DOUBLE nearby Polymet Mining’s, about 86% better NPV.
For example, at lower metal prices, discounted at 7.5%, FRAs is about US$ 300 million, compared to their neighbour, POM’s US$ 161 million.
eg. Copper $1.50 compared to today’s $3.00 circa.

Extract from earlier post 9/21/2006 regarding price targets:



FRA’s output is likely to be 70/80% of what POM are producing.

-Maturi/ Birch Lake has not been fully drilled out yet ie. There may be more metal.

-FRA have yet another resource of 236 million tons at Spruce Road (1/3rd of size of POM’s resource but at better grades)

Today (updated 12/21/06), FRA are valued at around 60 million dollars, POM are at 420 million dollars.

POM’s market cap is higher because they are further down the process and offer less risk (but now with less upside) In terms of progress, FRA are 18months to 2 years behind POM.

We could therefore see FRA having a market cap of around 420 million dollars in 2 years – i.e around 7 times today’s value.

So, taking today’s (updated 12/21/06) price of $1.50 X 7, gives a share price of $10.50.

However that figure does not allow for further fund-raising – dilution etc

Given that, within 2 years, I believe that we may be talking $8-10 dollars.

Also, don’t forget that POM are still in the feasibility stage. All things being good, their market capitalisaion/ share price should still have a lot of upside. It follows that they are likely to rise further and so should FRA. Both can rise a lot higher.

smilewithme