"Results are more important than dilution of shares and this tends to be forgotten amongst investors and traders."
I agree with you on that however, we are still waiting for results that are good enough to move the sp in the right direction but, we have suffered lots and lots of dilution.
I realize that you understand the effect of dilution, but many don't.
If you put $1,000 into a company with a market cap of $10,000, you then own 10% of the company.
If the company then does a CR at 1 for 10 then, unless you put in another $100 to maintain your 10% position, you will then only own about 9% of the same company.
If you contribute to the CR, then your total investment in the company is $1,100 for no return in sp increase and, in ICG's case, an actual large loss as the sp has declined considerably over the many CR's that the company has held.
As I said in a previous recent post, I feel that they should have stuck to the original plan to secure a resource, even a smallish one, which would have given confidence to the market, and shareholders, that there was at least something of substance there. This would have supported the sp and holders would have more than likely been willing to keep putting in for further exploration.
We must remember that the long term holders went through the Chanape experience where more and more money was put in only for it to be abandoned when no economic deposit was found. I stress economic here as a porphyry was found, which was a major achievement for management. That did not however help share-holders who effectively did their dough on Chanape.
Many LTH then manned up, or womanned up, and put in large amounts again to allow the company to go to where we are now.
Many now are tapped out of funds, and looking down the barrel of massive losses, and can no longer contribute to a CR without selling some shares first.
This then means that even if they sell to take up the CR that their percentage holding in the company has declined by way of dilution as they will not be increasing their number of shares held to offset the dilution.
The company needs to acknowledge that the sp needs to be supported one way or another so that holders are not taking a double hit with dilution as well as a decline in the sp.
After the first round of drilling, instead of some sort of resource, we just have more areas to drill and rock-chip samples. The chip samples may impress some people, and certainly Ross, but they do nothing for the market perception of Inca which wants to see substance.
Ross obviously has great faith in the project and, I feel that he thinks he can come up with the big one. I think also that he can but, the natives are very restless and feel very vulnerable.
Lockitt
ICG Price at posting:
0.6¢ Sentiment: None Disclosure: Held
(20min delay)
