Musings on Investing

Lockdown in the Third World

Revelo Resources, etc.

Some people believe that lockdowns around the world are a grand conspiracy. In my view, the reality is simpler: our governments and experts are utterly incompetent. They had no courage or independent thinking. With the exceptions of Japan, Sweden, Trump, and a few others, the rest of the world copied-and-pasted what China had started. This one-size-fits-all policy is particularly disastrous for the Third World, in which billions of people live from hand to mouth. Linked on the following image is a discussion I had on this issue with David Forsyth:

On Investments

  • Revelo Resources (RVL; C$0.21) has signed a non-binding offer to merge with Austral Gold. Assuming the merger goes ahead, RVL has a 40% arbitrage upside.
  • O3 Mining (OIII; C$2.75): O3 has gone up over the last few days. They recently released an updated PEA for the Marban project. Using US$1,450 per ounce as the gold price, IRR is 25%, and NPV (5%) is $423 million. At the spot price, NPV based on my calculations will be $750 million. I continue to see O3 as deeply undervalued.
  • Perseus Mining (ASX.PRU; A$1.45): The acquisition of Exore (about which I mentioned here) closes today. While I bought Exore for an arbitrage upside, PRU, in my view, offers a good upside. With most of the capital for the Yaoure project committed, PRU should be generating good cash-flow in the near future. PRU also trades in Canada.

Finally, the next Capitalism & Morality seminar will be held on 24th July 2021. And just in case you could not attend the last year’s seminar, all the videos are linked here.

Warm regards,

Jayant Bhandari

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