Alpha HPA Limited

ASX:A4N

Alpha HPA Limited

ASX:A4N
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$0.830 (-3.5%)
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#253
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2
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Forum Topics A4N A4N Bull Case

Pinned straw:
edgescape
Added 8 months ago

Couldn't find the latest Bell Potter report on Factiva but managed to find a report floating loose from the Bell potter site dating from Nov 2023. Mainly talks about Sapphire glass funding instead of HPA (High Purity Alumina)

Might help others here understand the investment thesis behind Alpha HPA

Which I still find hard to understand versus even something like a biotech would you believe mainly due to hardly any details on customers, offtakes, competitors, market pricing etc...

Overall a very challenging company to understand.

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edgescape
Added 8 months ago

Cadoux ASX:CCM is another HPA company but is sitting at a much smaller market cap (formerly FYI resources). They did have an agreement with Alcoa that got cancelled.

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When I understand the thesis behind a biotech such as Clarity pharmaceuticals or Neuren but can't explain the valuation of why A4N is so much more than a similar company such as Cadoux I'll probably sit on the fence for now

@Strawman you think we should try another meeting with Alpha HPA given the recent news and the PMs tour of the company?


5
Strawman
Added 8 months ago

I've shot off an invite to the MD Rimas Kairaitis @edgescape

I just had a quick scroll through the latest 4C and it did remind me of this (h/t @Wini)

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10
edgescape
Added 8 months ago

Thanks @Strawman

There is also QPM which I used to hold which again emphasises the huge valuation gap to A4N here. I do like the thematic however.

7
edgescape
Added 8 months ago

I've done some more research into the HPA sector and have a better understanding of where A4N is positioned.

As you know, HPA has been produced a graveyard of wannabees all with the promise of high IRR and NPVs. ADN, CCM, ATC, CR9 and now QPM (announced that current CEO is stepping down and now pivoting from battery metals to the gas energy market)

A4N seems different in that they rely on someone else (Rio Tinto) to provide feedstock for producing HPA through the patent SX process. Can argue this is an advantage over other HPA players using Aluminous clay as the feedstock.

Could write a straw on this but need a lot of time and will be pretty long. Instead if we get a meeting and I'm not there, we should focus on the following questions

* How costs stack up against inflation, wage pressure etc. The PFS was done in March 2020 at a time of low interest rates

* What are these guys doing that is different from the likes of Sumitomo Chemical (they produce HPA from their Aluminum refining operations), and Advanced Energy Materials (Private company with operations in Canada)

* Capex lifecycle. Number of years till some spending is required to keep the plant running at optimum production.

* What customers look for in HPA before signing the offtake (no offtakes signed yet, but I guess the federal funding does give a better incentive as customer does not need to fund the build)

Plus I'm sure there's a few other questions....

7