Red Gum Resources ASX: RGX

M

mickjohn

New Member
Not a holder but interested in what others think.

Red Gum Resources (www.redgumresources.com)
From the website:
Company Overview

Red Gum Resources Limited (ASX: RGX) was founded on the principles of a balanced growth portfolio which leverages the existence of high quality information to assist the real risks of undertaking any project. The Company has assembled a high quality and diversified portfolio of assets in Chile and Peru. Targeting base and precious metals, in particular lead, zinc and silver Red Gum has interests in 4 exciting tenements including the La Negra Project in Chile where drilling is currently underway.

By embarking on a rigorous project assessment during a down cycle on key commodities such as base metals, Red Gum believes it has acquired its interests at a considerable saving to current transaction values. RGX's multi commodity focus enables it to move nimbly in response to fluctuations in a single commodity price. Clearly, as in all businesses, the focus is on the actual potential operating margin, rather than the specific commodity, but further hedges against negative movements are made in selection of the best polymetallic projects, rather than having a sole focus.

In July 2012, the Company exercised the La Negra option to take 100% ownership of the property, which required a payment of US$500,000.

At La Negra, Red Gum is targeting an exploration target of 10Mt 70Mt* (up to 20% contained metals, largely Zn, Pb + Ag), with a large percentage of holes drilled encountering significant thicknesses of visual mineralisation, within a well-defined zone of the property.
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Recent surface sampling results announced 19July12:
High grade zinc, lead, copper, silver and gold reported from old workings over 1.2x0.4km area

Silver assays at 2,460g/t with 12 (29%) of the samples reported >100g/t and 5 samples reporting >500g/t

Gold assays up to 0.74g/t with 15 reporting >0.1g/t

Zinc assays up to 19.0%, lead up to 17.75%, copper 0.89%
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Listed on the ASX 17th Jan 2012
Cash at end of 31 Mar 2012: 3.6million+

Going through their reporting, they seem to stick to forecasted costs or generally have come in under them.

Market Capitalisation: $1.5million
Share Price: .05

Appreciate the stats are all over the place. The results are interesting and obviously they are operating o/s in Peru etc. One to watch maybe?
Incredibly low market cap imo.

edited: Mistake, not drill results but surface sampling results.
 
Bullion Baron said:
mickjohn said:
Cash at end of 31 Mar 2012: 3.6million+
Market Capitalisation: $1.5million
Share Price: .05
Click to expand...
They have 74,728,727 shares so market cap is $3.7m.

Some nice silver grades in the surface material, but until they get the drill in it's fairly meaningless.
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Yeah they are rock chip samples

Rock chip samples are taken at surface so the material that is found on the surface may not nessesarily originate from underneath the local area.

In other words it could have been brought in by other means rather than originating there.
 
At the end of march they has 3.6m cash so sounds like its trading as cash value, so at least you have a reason to say its fair value but not under valued.

If they find nothing economical - they will go to intrinsic value ($0)
This is why whatever they do find they will 'PREACH IT' hard. (ie 12000 g/t in rock chip)

More money comming end of 2014 via options @ 25c

So they will probably have to do a (at least 1) capital raising between now and then - I would wait untill that time comes and see what they have then and how the capital raising goes then decide. Too risky at this stage but keep watching.
 
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