Pulsar Helium Moves To The AIM Market
It seems like in recent months the London stock market has been losing stocks by the day. This either by takeovers, but more frequently by companies deciding that delisting would be the better path, either because things have gone pear shaped financially, or that the cost means it is no longer worthwhile having a quote. A factor which is just as important though, is market sentiment.
Helium: A Leader In Commodities
Clearly, there has been a bubble in lithium. But gold is at a record high, and commodities come and go in terms of popularity. If the commodity a particular company is looking for is hot, then money can be raised easily, and lots of shares change hands. There is little doubt that one of the hottest commodities around at the moment is helium, and we have seen such plays well backed on the London market. Indeed, it seems that even on the relatively fussy LSE, investors are happy to fund helium plays either at IPO, or in the secondary market, again and again. Ironically, this is even if they have found the gas or not. Such as state of affairs is perhaps surprising given the way that historically helium discovery has not been for the faint hearted.
Pulsar For AIM
Cue Pulsar Helium’s recent RNS, as the currently TSX-V listed announces that it is set to dual list on AIM in October. This weekend the Mail On Sunday covered the news. Pulsar will join just a handful of helium plays on the stock market here. But interestingly this number is already enough to make London something of a hub for this most sought-after of substances. The move to London makes lots of sense for PLSR, with its British founders, and very much British shareholder base. “Coming home” to London at a time when there is such interest in helium should on its own deliver for PLSR, but there are other factors at work.
The Sproule Report
This was revealed in terms of the company’s major news release on August 21. As is sometimes the case, it can take a while for investors and the market to digest. This is even when just announcements have been carefully considered. For instance, a key revelation was from the independent Sproule report regarding the Company’s first half 2024 drilling of the Jetstream #1 appraisal well. The highlights here were a 44% increase to Sproule’s previous helium Contingent Best Estimate (2C) Gross. Recoverable Resource, now 22.9 million standard cubic feet. A 12,165% increase to the helium Prospective Best Estimate (2U) Gross Recoverable. The resource is now 380.2 MMcf, Pmean of 1.3 billion cubic feet, and P10 of 2.8 Bcf.
The Largest Helium Find In North America
Coming up with the largest helium find in North America earlier this year caused shares of PLSR to be up 5x plus on their 30c listing price last August. This reaction was understandable, and certainly appropriate. The market reaction and price action since, perhaps not so much. Shares of PLSR are now back near 50c, which although a decent premium on where the shares started, misses out on the great strides already achieved. Indeed, it is possible to envisage a parallel universe where PLSR were now 50c without the benefit of Jetstream #1. That said, what the market seems to have not factored in is that the numbers in the Sproule report only relate to 13% of what PLSR is sitting on, so in a way the company’s stock market valuation omits a massive amount of potential resource, and ignores the bulk of what has been proved.
Peer Group Valuation
On this basis, while some who joined in the post February rally late may be disappointed, the opportunity at Pulsar is now to pick up stock in the company at a valuation which misprices the company’s achievements, even though it has already de-risked itself. The London listing ensures that the company is likely fully funded to production. London listed peer Helix Exploration (HEX) has seen its shares double since listing. Pulsar, which is arguably just as far or even further along its exploration timelines can be expected to do the same given what has already been proven up.
£5 Cashpile
With a cornerstone investment to raise £1.125m for listing costs and the latest £3.875m oversubscribed raise, bringing the total to £5m, PLSR is fully funded to move ahead. The priority is to deepen the Jetstream #1. We can expect a swift re-rate towards the C$1.70 equivalent here in London – some 3x on the price now can be seen to be a good target for AIM investors.
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