Hi OkraNot sure how relevant the question is - and I have posted...

Hi Okra

Not sure how relevant the question is - and I have posted a short answer before. But for the record I have been watching PLA since 2007 after being tipped off. However, I only took my first position in the stock in June last year and have been averaging down into the stock since then. So in short, the stock owes me a little, but being the optimist I am and given more recent developments I am betting on management being able to turn things around from here.

Having said that, I have family members who had bought in at $2.28. However I encouraged them to take up additional shares in the recent rights issue and now their average buy-in is closer to 16cents.

I remain positive about the stock for the following reasons;

Macro:
1. PGM prices have bounced of the lows of late Dec/early Jan and the gold/platinum premium is being unwound.
2. From my research I found that the supply/demand of PGM's is very tight and due to cost pressures stocks of these metal groups are heading/tending towards deficit - which will tend to lead to higher on average prices.
3. The european situation looks to be improving? Germany is still going strong (read: auto industry).
4. China is consuming loads of PGM's.
5. Russia's stock piles have been worn down.
6. Investment in PGM's through EFT's is growing
7. Majority (if not all) PDM producers/miners are under pressure. Exploration budgets are being cut and forecast expansion of reserves are not being met.
8. Lots of Regulatory and Sovereign risk in both South Africa and Zambabwe (which is probably also why we have not seen any significant cooperate actions in the sector more recently).

Micro:
1. PLA is sitting on the same resources and projects are every day slowly getting closer to being developed or spun-off.
2. PLA seems to have good ongoing relationships with local communities and is investing money here. Local communities have an investment in Smokey Hills and therefore have the economic incentive to see it turn a profit.
3. Smokey Hills is moving from Contractor operated to Owner operated with savings to be banked and a renewed focus by management.
4. Management are forecasting Smokey Hills to break-even by March 2012 (key test).
5. PLA has good working partnerships with respected local miners; Atla Mining and African Rainbow Minerals (ARM) and are continuing to develop the project interests in Kalplats and Rooderand. (Rooderand legal proceedings by Anglo subsidiary just a distraction).
6. The labor and possibility for future strikes has been elevated for 2 years as per new agreement with unions in Oct/Nov 2011.
7. PLA has electricity infrastructure in place at Smokey Hills and back-up generators in place.
8. After the rights issue PLA now has the cash reserves to see it through to the point when Smokey Hills becomes profitable.
9. Management have put their own money into the company through the rights issue. Not something you would expect them to do if they did not believe the company was a turn around story.

Final Point: Markets have been in turmoil for the past 6-9 months and been very unfriendly to any stock/management which has needed to raise capital. PLA has been hit particularly hard (given and was required to issue capital at deep discount. On this basis alone I believe when the stock is re-rated (of which there are a few triggers for this), then there is substantial upside potential here in.

It is only a matter of time for the Bull or Bear case to play out. There will still be some volatility and daily share price movements up and down - as we have seen recently. However, on the laws of probability I believe there is a strong case there will be a happy ending here. Its just a matter of time.

I'd be happy to hear what you're thinking and where you think the stock is headed.

Cheers

Gus