Analysis of Thorium Power Ltd

The Business:

Thorium Power, Ltd design and holds patent in design of thorium base reactors. Presently provides there services to one foreign country.

Design and holds patent are for an alternative energy sources other than

Fossil fuel(will last for another 100 year to take a conservative approach)

Coal (same as fossil fuel and also a major source of green house gases),

Wind, Sun and hydro base energy (Like all of them but cant give us enough power with present technology)

Nuclear Power (Uranium base)

The Company sell the nuclear technology which has Thorium as base fuel for the reactors, using which a relative more safe and environment friendly nuclear energy can be made which will have less nuclear waste.

History:

Traditionally the nuclear power is created by using plutonium base fuel. The Big powers who had the capability of deciding the futures source of fuel choose (not exactly from the start as plutonium base reactors come first) Plutonium as there base source as it gives them enrich plutonium which can be used to create nuclear bomb. The problem with this type of reactor is this produces plutonium which is difficult to store.

As the Plutonium stock of the country started increasing the storing problem also increased. The other problem with present day reactor (uranium as the base fuel) is you can’t share the technology with other country.

The solution to this was Thorium base reactor which has Thorium as fuel sources and create very less amount of plutonium as a by product. The problem is if the country is using uranium base and doing it for a while why to switch now.

Advantage of this technology:

1. Present reactor can be converted to thorium base reactors.
2. Does not create weapon grade plutonium so environment friendly.
3. Use little amount of plutonium (there might be different ways which does not use plutonium) to start the process so countries with huge reserves of plutonium can reduce there plutonium stockpile.
4. Can be given to friendly nations as does not produce nuclear grade plutonium. (uranium base nuclear reactor create plutonium which can be used in weapons)

Cut the Crap:

What is there for an investor?...

First thing first. The only client they have is Russia based research institute and UAE. If the research result are promising then they will create a royalty market by selling there patent and design specification to the clients and creating a roadmap to create a thorium base reactor.

Secondary market will be USA, France, India as they have the greatest resources of thorium thus may incline to it. The use of Thorium base reactor is not popular and a search of Thorium reactor in USA does not gives an indication that it is used in USA.

India may be a good market for this company after Russia. India have to buy uranium from other country to run there reactors as they have minimal resources of Uranium but they are one of the top 5 producer of thorium. But to sell there design to India Thorium Power Ltd will have to compete with other companies. Also there is a nuclear agreement to be signed to make this happen. The other threat to this deal is India has its own thorium base technology and they are already using it in couple of reactors. Thus limiting the possibilities there.

Points which can boost the share price..

If there is a agreement in India and USA then it will help this stock

Deals with UAE will also help this.

What you can expect

On this blog you will find my views on current financial analysis of various companies and in general whole market.

The information posted here will be good for very short ime only. This is not true just of my blog but it’s a general criterion any information related to a company posted any where on web is relevant only for a brief period of time. most post or information is not good after one month or so.