Thank you Roy for posting, and well done to the author for being brave enough to share this.

For what it is worth, these are my quick thoughts on the valuation:

·         Timing of revenues underestimates time required to commission and ramp new projects.

·         The TP and CO resources are massive. I assume both projects will ultimately double in size (120ktpa each).

·         I don’t think LAC will stop at two projects – but agree the valuation should not assume additional projects until they are secured.

·         Assumes selling price of $22,460/t (current spot price). I doubt multi-year contract prices will go that high. I assume $15,000/t, but accept that it could go higher than that.

·         It would be prudent to assume TP capex and opex is higher than set out in the PFS. I assume 10% to 15% higher.

·         Its not clear what assumptions have been made for overheads, maintenance capex, taxation etc.

·         If you are going to value based on 20 years, you need to include a terminal value to reflect the remaining years of cashflow. This adds significant value, particularly given my assumption regarding the ultimate size of TP and CO.

·         A discount rate of 12% seems low, given the significant execution risks remaining. TP is not fully funded, and LAC will need to give away significant value in the partnering process. I use 20% (reducing over time, as risks fall away).

Overall, some pluses and minuses. I think LAC will one day be valued at $78 per share, but not before it is further de-risked. I value today at $40, but accept the SP will not get to that level until the judicial review is completed. Partnering will lower the cashflows, lower the execution risk (discount rate), and overall add significant value.

IMO. DYOR.