IRL - India Resources

[lazyfish]

Hi Miner,

Agreed that they should not have kept investors in the dark for so long, but then I heard they are planning to release the info on the deal "soon". The rights issue was taken up by Eoin Rothery, not Michael himself. I think Michael said during the AMEC presentation that he would put some money in when he manages to find some spare money, lol that was not terribly convincing...

I really wish you had asked him about his Indian crew last Saturday

 

[sharemadder]

DJ Five Cos In Running For India's Kehtri Copper Mine - Report29/11/2007 08:24AM AEST

SYDNEY (Dow Jones)--Oxiana Ltd. (OXR.AU) is one of five companies shortlisted to take control of the Kehtri copper deposit in northern India, said the Australian Financial Review Thursday.

Citing Hundustan Copper Ltd. (513599.BY) executive director O.P. Singh, the newspaper said India Resources Ltd. (IRL.AU) and Anglo American PLC (AAL.LN) were also among five companies in the running for the mine.

Singh said the mine, currently closed after open-pit operations were exhausted, could support annual production of up to 16,000 tons of copper metal, and had extensive exploration potential.

 

[Jack_Junior]

Dear Jack Junior
You are lucky.
I bought the share at 37 cents and option at 20 cents.
Insult to injury I again bought the rights at 20 cents just to see it going down at 17 cents. I am still holding it with hope (!)
Michael K (famous Consolidated Chairman) is also the chairman for this company and the copper site is really very good. The senior management is also very good. But since MK is too busy in else where including building his assets in MON so IRL is currently a bad boy in share market.
Probably I have posted it before, the share is worthy to hold until March 08. Remember no cyclone will be at India from now to March and the weather and productivity will be fantastic as well.
Keep fingers crossed.

Cheers Miner,

So what price would you be happy to sell at given our entry price.
I'm pretty much new to the whole trading game and probably dipped in a bit too big and a bit too soon into IRL.

I guess I am looking for some respected opinions of what expectations we should have as far as a medium to long term investment in the company goes.

Don't want to get out too soon or too late

 

[prawn_86]

I too am keen on these guys and will post my full research shortly, although there has been some excellent fundamental analysis done already earlier in the thread.

 

[prawn_86]

I have kept this fairly short as there is a lot of already good research on this thread. Particularly Pommiegranites post on page 1 detailing all their projects.

IRL – India Resources​

152mil shares @ 16.5c = 25mill current market cap
@ 20c = 30.4mill
@ 30c = 45.6mill

90mill options @ 20c (end of 09) **not included in calcs**

Aiming to produce 4500 tonnes Cu concentrate from recently opened mine.

4500 * 4k per tonne = 18mill

Take out say 50% in costs = 9mill profit = 6cps profit

Therefore PE of 10 would give 60c per share. Which is a very conservative estimate imo.

Good directors who can steer the co in the right direction and other tenements in India all points for a favourable mid-long term outcome for this one.

This seems very undervalued. Especially so as it is not taking into account any other potential from their other projects.

 

[prawn_86]

Closed up 6% today, although the VWAP was still at 16.5 cents, where the price has been for the last few days.

Volume has been gradually increasing this week, but not worth writing home about.

Could 16.5c be a base forming? It would be nice, thats for sure.

 

[Miner]

Cheers Miner,

So what price would you be happy to sell at given our entry price.
I'm pretty much new to the whole trading game and probably dipped in a bit too big and a bit too soon into IRL.

I guess I am looking for some respected opinions of what expectations we should have as far as a medium to long term investment in the company goes.

Don't want to get out too soon or too late

Mate Jack_Junior
Do not know the answer to advise you. I would like to see how deep it can go.
With Khetri copper project bidding it is still speculation as in India it is not how well you have put your bid, it is added up with politics, back door calculation, contacts bla bla.

However looking into CV of Mr SP Singh who is an ex army man I am hoping he know the trick of the game compared to many others. Indian Army is traditionally very skill in negotiation as well. Do nto believe me just type BOFORS GUN SCANDAL in google there would be interesting articles.

Honestly, no matter how deep I gone into red I am hoping to recover it in March so sitting tight and if opportunities come I will buy more IRLO options at a very low price in mid Dec.

Regards

 

[prawn_86]

Interesting article about MK's possible desire to consolidate his co's.

Also i didnt even know he used to be a director of AZC!

Kiernan outlines ambitious plan for consolidation
Special Reports: 27-June-07 by Mark Beyer


Mining entrepreneur Michael Kiernan last week outlined to WA Business News his plan plan to bring together his non-gold companies under the joint ownership of iron ore miner, Territory Resources Ltd.

Mr Kiernan, who formerly ran diversified mining house Consolidated Minerals Ltd, is currently chairman or a director of eight listed companies.

In partnership with Hong Kong trading house Noble Group, he is planning to use Territory as the vehicle to consolidate ownership of most of these companies.

“We will leave Monarch but bring everything else together under Territory Resources,” he said.

This would include Precious Metals Australia Ltd, which is developing the Windimurra vanadium project, mineral sands miner Matilda Minerals Ltd, and newly floated India Resources Ltd.

“I like building projects, I like building companies,” he said.

“There are very many opportunities for smaller companies that don’t have access to capital, don’t have access to exploration or mining expertise. You bring them all under one umbrella and they become very successful.

“It’s a formula we used to use at ConsMins and its very successful.”

Mr Kiernan said Territory, which this month started mining at its Frances Creek mine in the Northern Territory, was likely to make an acquisition before the end of the year.

“There are three milestones for Territory over the next six months; one is to get Frances Creek into production, two is to start a seriously aggressive exploration program to double resources within 18 months and double the production, and third is to probably do a corporate acquisition.”

A common link between all of the companies in Mr Kiernan’s stable is that he, Noble Group, or their jointly owned investment company, Crawley Resources, have substantial shareholdings.

Territory, for instance, is 31 per cent owned by Crawley, following a $30 million placement earlier this year.

Mr Kiernan said Territory could acquire some of the shares held by Noble in other companies, such as Precious Metals.

“Noble has a 10 per cent stake in Windimurra Pty Ltd and ultimately will also have a 10 per cent stake in PMA, the parent company,” he said.

“I wouldn’t see that being restructured into Crawley but could well be restructured into Territory Resources.

“Or Territory Resources may take a position direct into PMA.”

Renowned for being a straight shooter, Mr Kiernan said he and Noble selected Territory as their consolidation vehicle “because it was there”.

“It was an opportunity to invest in that company…develop the project, and then use Territory Iron as the vehicle to become a diversified carbon steel material supplier. That’s why we changed the named to Territory Resources,” he said.

“Its first subsidiary is Territory Iron, which will operate Frances Creek and one or two other iron ore projects we are looking at.

“Each of the other projects we get involved with will be fully owned subsidiaries with their own management in place.”

Mr Kiernan’s game plan for the next couple of years also includes further acquisitions by gold miner Monarch.

The company recently commenced gold production at its Davyhurst project, and later this year will start producing at its Minjar project.

Together, these projects will produce about 200,000 ounces of gold per year; his targeted production rate is 500,000oz by December 2009.

“It is quite obvious that we will acquire or merge a couple of other projects,” Mr Kiernan said.

A long row of yellow files in Mr Kiernan’s office is testament to the number of gold projects he has reviewed.

He is prepared to be opportunistic, bidding for distressed assets, and also has people bringing projects to the company.

Reflecting his background as a contractor, Mr Kiernan said each of Monarch’s gold projects would be discrete, with its own management team, including accounting, technical and operating staff.

“Each project has to stand on its own,” he told WA Business News.

“I make each site stand totally on its own from a profitability point of view and return on equity.”

With Mr Kiernan holding so many board positions, it is inevitable that he gets asked about his ability to manage the workload.

He left the board of Australian Zircon Ltd in April and stepped down as chairman of uranium explorer Uran Ltd earlier this month.

Mr Kiernan insists he can handle the remaining roles, describing himself as a professional director who works six days a week from his office in West Perth with three secretarial staff to assist.

He also emphasises that each business has its own management in place.

As chairman, Mr Kiernan said his job was to focus on corporate governance, strategic direction and funding.

“The managers of the companies execute and operate the businesses. I don’t have to operate. We set budgets, we set KPIs, and that’s what I manage against.”

Being decisive also helps Mr Kiernan manage his many roles.

“In business today people are afraid to make timely decisions. Love or hate me, I listen to people and I make a decision,” he said.

He will soon have to make some big decisions about PMA’s Windimurra vanadium project, which has been through some major revisions.

Planned production has increased from 12 million pounds to 22 million pounds, the project will produce ferrovanadium, and it has been affected by the cost pressures facing all developers in WA.

It has also deferred the target date for locking in debt funding from March 31 to June 30.

Mr Kiernan said he had asked the project team to finalise the flow process and precisely quantify the capital cost.

“Once those two have been established, we can then look at the exact funding required,” he said.

“There were no problems or issues, it was a case of ‘let’s take two months to really review and refine’.”

The project’s total capital cost has previously been estimated at $200 million, but this will increase.

“I suspect the component PMA will be responsible for will remaining $200 million,” Mr Kiernan said.

“We may get one or two of the aspects done by a contractor under a build, own, operate and transfer, so PMA is not responsible for that capital up front.”

He remains confident that PMA, with the assistance of Noble, will arrange funding for that project.

The aim was to repeat the successful formula he and Nobl had at ConsMins.

“The philosophy is quite simple. My job is to dig and deliver. Noble’s job is to market and be responsible for logistics and funding.”

 

[prawn_86]

5 new indian leases to explore for diamonds granted with an agressive exploration program planned for early 2008.

Now that copper production has started it will be nice to watch them advance some of their other projects

 

[lazyfish]

I have kept this fairly short as there is a lot of already good research on this thread. Particularly Pommiegranites post on page 1 detailing all their projects.

IRL – India Resources​

152mil shares @ 16.5c = 25mill current market cap
@ 20c = 30.4mill
@ 30c = 45.6mill

90mill options @ 20c (end of 09) **not included in calcs**

Aiming to produce 4500 tonnes Cu concentrate from recently opened mine.

4500 * 4k per tonne = 18mill

Take out say 50% in costs = 9mill profit = 6cps profit

Therefore PE of 10 would give 60c per share. Which is a very conservative estimate imo.

Good directors who can steer the co in the right direction and other tenements in India all points for a favourable mid-long term outcome for this one.

This seems very undervalued. Especially so as it is not taking into account any other potential from their other projects.

Sorry Prawn, this is not correct. It is 4500 tons of copper concentrate grading 25%-30% copper, not 4500 tons of copper metal. I have already confirmed this with management. At full price the concentrates are only worth $2000 a ton or so. With the discount factored in it would only be around $1000 per ton or so. The mine was closed for a reason (I think the Indians could not operate the mine profitably, I am not 100% sure), and I seriously do not expect IRL to make significant progress with the current shaft because they will be doing mostly what the Indians have been doing. With the decline next year, it could be another story altogether.

 

[prawn_86]

Thanks Lazyfish,
I was wondering why the price difference was so large.

So heres a few quick calcs:

4500 * 20% copper = 900tons

900 * $ 2k = $1.8mill

$1.8mill / 150mill share = 0.012 = 1.2cps

Take out 50% costs = .6cps

So therefore at current price (17c):
PE = 28.3.

So my new take on the co is that a bit of cashflow is always nice to have and once they extend the processing amount it will be even better, and allow them to focus on all their other projects without the need for capital raisings etc.

So essentially imo, it is still worthwhile, although it now depends a lot on other projects and their viability.

 

[jonojpsg]

Thanks Lazyfish,
I was wondering why the price difference was so large.

So heres a few quick calcs:

4500 * 20% copper = 900tons

900 * $ 2k = $1.8mill

$1.8mill / 150mill share = 0.012 = 1.2cps

Take out 50% costs = .6cps

So therefore at current price (17c):
PE = 28.3.

So my new take on the co is that a bit of cashflow is always nice to have and once they extend the processing amount it will be even better, and allow them to focus on all their other projects without the need for capital raisings etc.

So essentially imo, it is still worthwhile, although it now depends a lot on other projects and their viability.

Except now you've gone the other direction and factored in the 20% copper in concentrates as well as only allowing $2k per tonne whereas copper is more like $6k per tonne which will bump EPS up by a factor of 3 giving a PE of 9.4 although this doesn't factor in the deal with Hindustan which probably takes some away from this.

Lazyfish's comments re putting in a decline though is probably where the money will be made (we hope - I hold)

 

[prawn_86]

Ahh i see what lazyfish said now, i mis-interprited it.

I read it to say that you get 25% copper out of the concentrates (i used 20%) and of that copper you get out you only get $2000 per tonne.

Whereas what he meant to say wat that you get $2000 per tonne of the concentrate totals.

hmmm sorry guys and gals

 

[Miner]

Dear Technical Whiz Chartists

Would one of you please draw the trend of IRL and advise in this forum how far it could bottom out with the trend before it goes up ? It will be a buying opportunity (I am hoping to average / consolidate my earlier buying at the top price of 37 cents and the rights at 20 cents by buying IRL at a very low price now ). Did I expose myself too much to every one to know I was stupid ?
They have gone for diamond exploration where as focus will be more on getting the copper out from Musaboni and winning the Khetri Copper Tender.


Regards

Miner

 

[sharemadder]

BUSINESS NEWS
Surge in power capacity to raise Indian copper appetite

Friday December 7, 02:15 PM
By Biman Mukherji

NEW DELHI (Reuters) - Burdened by rolling blackouts and industrial power shortages, India is bent on expanding its power capacity, potentially boosting copper demand sharply and reviving global interest in the metal.

Because of India's roaring economy, India's power production needs to rise by 15 to 20 percent annually, and with it, lots of copper consumed to meet the demands of its billion-plus populace.

If the projects take off as planned, India will likely have less copper to export, which could ease worries that copper demand will slump if the U.S. economy continues to falter.

"We could turn into a net importer of copper, provided all these power projects come on stream," Hitesh Aggarwal, vice president of research at Angel Broking.

Copper has fallen 20 percent since October to $6,755 a tonne on a dimming demand outlook.

"The need for more power has sunk into everybody's head," said Gnanasekhar Thiagarajan, director of Commtrendz Risk Management. "We suspect that many Indian players would start making bulk purchases of copper now as prices are low."

Because of the new building in plants and other infrastructure, India's annual copper demand is expected to more than double to nearly 1.5 million tonnes by 2012, from 600,000 tonnes now.

The country's production is estimated at 700,000 tonnes and India usually exports between 100,000 tonnes and 150,000 tonnes a year.

"For every addition of 1000 megawatts, there will be new demand of 10,000 to 15,000 tonnes of copper," said a senior Mumbai-based analyst, who did not want to be identified.

"We know of at least three power projects coming up now which will consume an additional 50,000 tonnes of copper," he said.

Domestic copper producers, including Sterlite, Birla Copper and Hindustan Copper are able to meet domestic demand now, and are able to even export small quantities.

"We don't see the situation changing for at least two years," said the Mumbai-based metals analyst. "That is because many of the projects are still in the initial stages."

"The picture could well change once the new power projects come on board."

Private and state-run power firms are planning capacity expansions of nearly 60 percent over the next several years, which will not completely solve the ongoing shortages.

"We would need to raise capacity by at least this much, if not more, to even maintain the present level of shortages," said Harry Dhaul, director general of Independent Power Producers Association of India.

India needs to invest $1.25 trillion by 2030 into its energy infrastructure, according to the International Energy Agency.

The country's energy shortfall touched 9 percent last year and at peak times the gap between demand and supply is nearly 14 percent.

More than 412 million people in India have no access to electricity and some villages only get a few hours a day.

GAPING SHORTAGES

India plans to finalise four more of its "ultra-mega power projects," each capable of generating 4,000 megawatts, by March 2009, more than the electricity consumed by teeming New Delhi.

The projects, which are to be located in states such as Gujarat, Madhya Pradesh and Andhra Pradesh. The country has already allotted two such projects to private bidders so far this year.

"If the power sector takes off, then copper demand will also take off," said Sunil More, director general of the Indian Electrical and Electronics Manufacturers Association.

"There is a new seriousness in expanding power capacity as compared to 10 years ago," More said.

To be sure, despite the number of power projects planned over the next four to five years, the percentage of copper consumed is unlikely to go up proportionally as in other countries because of the traditional preference for aluminium in busbars, the flat strips or tubes used in electrical power distribution.

Indians have favoured the use of aluminium over copper in certain applications because it is cheaper, albeit weaker conductor, said Ajit Advani, chief executive officer of International Copper Promotion Council's India office.

He said that though aluminium was cheaper to buy upfront, copper was more economical if the entire life of many products were considered.

"As energy conservation and the environment become more central to our decisions, our per-capita copper consumption would increase," he said.

But Advani said he even expected an increase in the use of copper plumbing in India because of greater durability and better hygiene.

India's per-capita copper consumption is slightly over half a kilogram per person, compared with 3.5 kilograms in China and 12 kilograms in developed countries.

 

[sharemadder]

MEDIA RELEASE 11 December 2007
SURDA STEAMS TOWARD FULL PRODUCTION

Diversified minerals developer India Resources (ASX:IRL) is on the cusp of full scale mining and production at its Surda copper project in north east India, following encouraging results from its trial mining operations.

Production at Surda commenced ahead of schedule last month and IRL has since mined about 2000 tonnes of ore, and including broken ore from previous mining activity, has crushed about 3000 tonnes.

IRL Chairman Michael Kiernan said mining and concentrating operations had performed well, and the Company had achieved its early targets for copper grades and recovery rates.

“Our active mining face shows grades up to 1.9% copper (average of 1.1% Cu), and we have achieved concentrate grades of up to 23.4%,” Mr Kiernan said.

“Trial recoveries were 80%, although we expect that to rise to 95% by January 2008, and concentrate grades to increase to 25% over that time as well.

“We now have more than 400 people employed either directly or through contractors, and our refurbishment of the mine continues ahead of schedule,” Mr Kiernan said.

While ore from the active working areas at Surda is dominated by chalcopyrite as stringers and disseminated ore, mining has also identified a zone of semi-massive sulphide (see photo overpage).

Recent mine and plant refurbishment at Surda has included reconditioning of machinery and ore bins, and refurbishment of underground working areas.

At the Mosaboni Concentrator plant, the first of two available crushing lines has been refurbished, along with one of five ball mills and one of five flotation lines. This work has allowed production to commence with ongoing improvements to increase capacity to its nameplate 2,700 tonnes per day.

“We expect to be in full scale mining this month and we are on track to achieve an initial annual target of 4500 tonnes of copper concentrate per year,” Mr Kiernan said.

 

[adobee]

Considering how close they are to begin mining and producing money India Resources doesnt seem to be getting much interest ..
I am considering buying back in at 15c but have already lost money on this once so am a bit unsure. ..

 

[prawn_86]

They are starting to ramp up the media machine, with 2 anns in 2 days saying what holders already knew, but this may help to attract outside attention.

I guess thats the plan anyway

 

[sharemadder]

Still have traders huge selling into news pressure. Will take a road show to get some better attention here I think as new issue / option holders selling into every possible move up

If people believe that IRL will do well in India over next two years then options would be a cheap entry with lots of upside.

 

[sharemadder]

Some better news today - director buys on market 1 million shares

APPENDIX 3Y NOTICE
In accordance with ASX Listing Rule 3.19A.2, please find enclosed an Appendix 3Y notice in respect of the on-market purchase by the Chairman, Mr Michael Kiernan, of an additional 1 million shares in India Resources Limited