BND - Bandanna Energy

[mark100]

BND has extensive thermal coal holdings, in the Bowen and Galilee Basin.

They have been undertaking a strategic review to work out the best way to fund the development of these assets. Part of their announcement yesterday states:

"That despite Bandanna’s capacity to raise the necessary funds, corporate transactions or whole
of asset transactions should be considered where they deliver greater value than can be
achieved by Bandanna funding and developing its projects."

In my opinion, these sort of reviews tend to end up with a bid being made for the whole company.

I have held for a while

[mark100]

Forgot to add, BND also has a 4 Mtpa allocation at the proposed Wiggins Is port terminal

[mark100]

Resource upgrade just out

[dan5]

Doing some research on coal explorers and found this thread (and this site). BND doesn't seem to be discussed much here or on other forums but reading this (http://www.theaustralian.com.au/business/opinion/local-players-not-out-of-bandanna-bidding/story-e6frg9if-1226005960380) article makes me wonder why? Am I missing something?

[mark100]

Some threads are popular others not so. I thought with coal being hot and corporate transactions occuring all over the place this stock could generate some discussion.

[dan5]

Strange how stocks go in and out of fashion. I've looked at GUF as well which has no resource in its Galilee tenements but seems to be flavour of the month while BND with a billion tonnes in the Galilee doesn't appear much in the forums.

[mark100]

Indian interest

http://economictimes.indiatimes.com/news/news-by-industry/energy/power/3-indian-cos-in-race-to-bid-for-bandanna-energys-coal-assets/articleshow/7732330.cms

[macduffy]

I'm not able to show the relevant chart here but would any of the TA-literate care to interpret/comment on BND?

Am I correct in reading the short term, shallow downtrend and the RSI nudging 70 as an "overbought" signal?

[Phaedrus]

BND is in a short-term downtrend MacDuffy, but the RSI:14 (default value) is at 50 rather than "nudging 70". Note the Bearish Divergence where the RSI is making lower highs.

The most salient feature on this chart is the obvious resistance at $1.90. Three times the Bulls have pushed prices up to this level and three times it has been met by a wall of selling. Note the huge increase in volume as BND is being "churned". For most of this year BND has been essentially trendless in a $1.44 - $1.90 trading range. Theoretically this "ought" to break to the upside but it would take a brave (or foolish) person to act on that assumption. I can't tell whether you are interested in buying or selling BND, but if you are thinking of buying, stop. While there are no really obvious Sell signals just yet, most every indicator is either flat or Bearish. If you hold BND and are wondering whether to sell, I would be inclined to wait for a break of the trendline or some other Sell signal before acting. Strong holders might prefer to wait for a break below the trading range before selling.

If I held BND and was sitting on a handsome profit, I would be looking very seriously at selling. Continuing to Hold is an option, so long as the situation is tightly monitored. Buying right now would be extremely ill-advised.

http://i602.photobucket.com/albums/tt102/PhaedrusPB/BND44.gif

[macduffy]

Many thanks for your comprehensive reply, Phaedrus!

I don't hold BND but it's on my watchlist and one I'd like to buy at the right time/price.

As you can tell, my grip on TA is rather tenuous and doesn't go much further than not buying in downtrends! My take on the RSI number is from Direct Broking's "Super Charts" where the RSI, however they calculate it, is "nudging 70". Clearly that's a cruder measure than RSI:14 so I'll continue to treat it with caution.

I'll keep watching BND's trend.

[Phaedrus]

SuperCharts RSI is a bit of a worry, MacD. Here is a much better chart that you will have access to :-
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=Stock&symb=AU:bnd&x=17&y=10&time=6&startdate=1/4/1999&enddate=4/3/2011&freq=1&compidx=aaaaa:0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=2&lf2=0&lf3=0&type=64&style=320&size=3&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11

[mark100]

Good news for Galilee basin stocks

http://www.business-standard.com/india/news/gvk-set-to-buy-hancock-coal/430963/

[mark100]

From todays Australian

Bandanna keeps tabs on Galilee action

AS Gina Rinehart's Hancock Prospecting thrashes out a multi-billion-dollar deal with Indian power group GVK Infrastructure to sell it two prospective coalmines in the Galilee Basin, one party keeping a close eye on the proceedings is Bandanna Energy.

The Galilee Basin has been a hotbed of activity recently, with India's Adani Enterprises buying Linc Energy's assets last year and Clive Palmer, who also has a big holding in the area, preparing for a Hong Kong listing.

Bandanna, which has UBS working on a strategic review and potential asset sale/joint venture partner search, is understood to have attracted interest from bidders in China, India -- which has been buying up thermal coal for its power stations -- Japan, Korea and Australia.

However, the deadline for indicative bids has been pushed back to early next month as the company awaits results of pre-feasibility studies for several projects including its South Galilee joint venture with the privately held US coal investor AMCI. The thinking is that the studies, expected to be released within a week, will be positive for valuation.

The price Rinehart gets from GVK is another factor that could influence Bandanna's sale price, especially given the market is ascribing very little value to the Galilee assets at the moment (UBS analysts, for example, value it at a conservative $50m).

The miner, which has five projects in Queensland's Galilee and Bowen basins at advanced stages of evaluation, has been valued at $1.4 billion by Wilson HTM. The broker's discounted cashflow valuation is $1.8bn.

Meanwhile, Rinehart's exclusive negotiating period with GVK is expected to expire mid next month.

The proposed deal involves an upfront payment of $1.3bn, then a further $1bn when mining commences.

Rinehart's is the most advanced project in the area, although the first coal from the Galilee Basin is not scheduled to leave the country until 2014.

[mark100]

Well there has been plenty of media reports over the past few weeks regarding the corporate interest in this one. Every man and his dog has been given a chance to get on board!

The AFR today reckons a potential value of up to $1.5b for BND if the Galilee assets get valued in line with the numbers being thrown around for Hancock Coal are repeated. That's $3.50 / share although I think more like $3 is the number that will get over the line here

[soulman]

No post on BND for a while and rightly so. The shares has plummeted from $2 to as low as 46 cents. Currently at 69 cents after a big surge yesterday. I have bought in.

The Phaedrus warning post above is a great example of not buying downtrending stock. After BND cap raising at $1, their shares has not traded above $1 at all. Cash on hand of $130 mil should provide BND with plenty of WC for the next few years.

You still in Mark and have you bought more?

[drillfix]

I have bought in.

The Phaedrus warning post above is a great example of not buying downtrending stock. After BND cap raising at $1, their shares has not traded above $1 at all. Cash on hand of $130 mil should provide BND with plenty of WC for the next few years.



Yes the Mr. P's warning of buying down trending stocks.

Although, I think he was referring to buying and holding as there nothing wrong with buying a bounce of a down trending stock as providing we dont hold onto it as you know, and as some do, then fall in love with it only to watch the money get washed away gradually, which is a good warning indeed.

Good luck with this one souly~!

[mark100]

Traded many times over the past year soulman. First entry was around $1.30, was looking great at $2.20 plus with all the takeover talk and then it dropped like a stone. I bailed on the way down with only a tiny profit to show despite sitting on some lovely paper profits at one stage. Then got in for that short run from 60-90c when Bell Potter were spruiking it but haven't owned since. The market has gone cold on coal lately (same with MTE another one I traded a lot).

After yesterdays move its back on my list but until they have a get a JV partner in for one of their projects I don't think I will buy. There has been too many un-substantiated rumors with this stock so next time I want a signed deal.

BND has some great assets but needs a JV partner to provide development funds

[soulman]

Out today Drill. Just one of those trade that you go MAD for a few minutes. I had a sell order for 73.5 last night and then saw on the computer 2 hrs into the trading day that it went to 73 cents (quite a few volume churning through 73 as well) and missed the 73.5 and downwards it goes. That's part of the game and I obviously in hindsight picked the wrong number, which is by random anyway. I could also wake up early and get on the job but I always rather trade midway through the session. Being in Perth WA, the session starts at 7am.

Eventually I sold for 69.5 one hr before closed. The buyers support dropped off midway through the trading day.

Anyone's guess what BND would do on the next trading day.

Mark, Insider Trader was spruiking BND last week and it obviusly worked. The volume are encourging. The profits I made on BND can offset my losses in MTE.