The Transformation Journey of Cangu: From Car Dealership to Crypto Mining

Recently, Cangu Company launched a series of significant initiatives, marking a notable shift in its business direction. The company announced the acquisition of running crypto mining equipment with a hash rate of 32Eh/s for $256 million. Following this, Cangu also plans to further acquire operational mining equipment with a hash rate of 18Eh/s by issuing $144 million in stocks. These actions clearly outline Cangu's strategic blueprint for transitioning into the crypto assets mining sector.

It is worth noting that CanGu's Bitcoin output reached 393 coins in November. This data not only showcases the company's initial achievements in the new field but also provides substantial reference for its future development.

In-depth analysis of Cangu's acquisition reveals several key points:

1. The first batch of 32Eh/s Mining equipment is distributed across five countries, including the United States, the Middle East, and Africa. These devices are mainly flagship S19 miners, with an expected depreciation period of about 4 years. The shutdown price for each Bitcoin is approximately $70,000, which includes the hosting operational costs.

2. The acquisition funds for the second batch of 18Eh/s equipment will be raised through a targeted issuance of shares to an investment group composed of 9 individuals, with the transaction expected to be completed by March 2025. The seller is Golden TechGen (GT).

3. Canggu has also signed a supplementary agreement as an incentive for investors. If the company's market value reaches a specific level for 30 consecutive trading days within the next 30 months, these investors will receive additional shares worth $97.1055 million.

4. Despite the significant recent increase in Bitcoin prices, the acquisition price of Canggu is relatively reasonable. This is because the company started engaging in the project when Bitcoin prices were in the range of $60,000 to $70,000, thus achieving an acquisition close to the par value.

5. After completing this acquisition, Cangu will completely transform from a car dealer to a self-operated Mining company. The company plans to further expand its business based on this, involving fields such as computing power leasing and cloud hosting, in order to balance the impact of Bitcoin price fluctuations on the company's profits.

From an investment perspective, the prospects of Cangu are worthy of attention. By March 2025, the company's total operational hash rate is expected to reach 50Eh/s, making it likely to become the largest mining company among publicly traded companies in the United States. In comparison, the current hash rates of other major mining companies in North America, such as Marathon Digital and Cleanspark, are 46Eh/s and 32Eh/s, respectively.

Considering that the shutdown price of Cangu is relatively high, we can conservatively use $110 million per Eh as the valuation benchmark. Based on this calculation, before the completion of the second batch of acquisitions, Cangu's market value should reach $3.52 billion; after the acquisition is completed, the market value could rise to $5.5 billion. Compared to the company's current market value of only $720 million, Cangu's stock price seems severely undervalued, with potential upside ranging from 3.9 times to 6.6 times.

Overall, Cangu is undergoing a strategic business transformation, shifting from traditional car dealership to the opportunity-filled crypto mining sector. This shift not only demonstrates the company's vision but also provides investors with a potential high-return opportunity. However, considering the high volatility of the crypto assets market, investors should remain cautious and fully assess the associated risks when making decisions.