$2.22 is a pretty limp SP for this company in the context of what lithium demand & supply should look like over the next five to ten years.
However, the ASX200 is having an awful day (down 1.27%) and GXY is holding up (up 0.91%) OK.
The TH to confirm the cash was a bit weird, especially given there was neither a TH nor a statement from GXY when the POSCO deal was originally announced, which was a bolt from the blue and sent the SP to $3.60.
However, the cash in the bank opens up possibilities.
GXY management said they had received a number of *offers*.
My question is - are they JV offers, offtake deal offers, a combination, a mix of all three?
Whatever the case these offers won't sit on the table in perpetuity.
In the case of JVs sooner or later management either has to take one OR announce they are going it alone.
If GXY goes it alone it will mean slower progress but a bigger long-term windfall. A JV means the action heats up sooner, which could mean capitalising on the lithium supply squeeze that will probably start in the second half of this year (and last for quite a while!).
If management refuse the JV offers, and go it alone, then an offtake deal has to be secured at some point.
These issues will likely be resolved within the next few months... right?
GXY Price at posting:
$2.22 Sentiment: Buy Disclosure: Held
