Should I buy Thungela Resources shares after its IPO?
Thungela Resources (LSE: TGA) shares are the FTSE 100s newest constituent. The company, which has been spun off from parent Anglo American, joined the market on Monday. The shares listed at 150p and have since been on a wild ride. After plunging to around 111p, the stock then bounced back to 151p. It seems as if the market cant make up its mind whether it likes the business or not. 5G is here  and shares of this sleeping giant could be a great way for you to potentially profit! According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air And if you click here well show you something that could be key to unlocking 5Gs full potential...  Its easy to see why. Thungela owns interests in and produces thermal coal predominantly from seven collieries located in Mpumalanga, South Africa. While these mines are among the highest quality thermal coal mines in South Africa by calorific value, the environmental costs have forced many investors to move away from the sector in recent years. ESG commitments  For its part, the company is committed to enhancing its environmental, social and governance (ESG) factors. It has established an employee partnership and community partnership plan. Management also claims the group has a robust ESG framework in place, which underpins its licence to operate. However, specialist short-selling firm Boatman Capital Research has claimed the company is underestimating its environmental liabilities. Thungela has set aside around $468m for end-of-life mine rehabilitation costs. But Boatman claims that new rules, known as NEMA 2015, will impose more demanding and more expensive environmental standards on miners in South Africa. The new rules are set to take effect in June 2022, delayed from the original date of June 2021. Under these new rules, the short seller claims the total end-of-life environmental costs could be more than three times higher than Thungelas owns estimates. As well as this uncertainty, theres also a great deal of uncertainty surrounding the future for coal as a power source. The world is rapidly moving away from its use. Clean energy sources are quickly becoming cheaper and more efficient. As such, its difficult to predict how the demand for coal will evolve over the next five to 10 years. Whats more, the company wont remain a FTSE 100 constituent for long. Its moving from the UK to South Africa this week, with its primary listing in Johannesburg. After the move, it wont be eligible for inclusion in the FTSE UK indices. Uncertainty surrounding Thungela Resources shares  All of the above makes it incredibly challenging for me to place a value on Thungela Resources shares. Still, short-sellers arent always correct. Boatmans analysis of the companys liabilities may be overstating the true picture. If thats the case, the group could become a cash cow if its high-quality mines start throwing off profits. Indeed, coal is still being used heavily across the developing world as an energy source, although its not clear how much longer this will last. Nevertheless, if current demand levels persist, management is confident the companys high-quality assets can produce cash flow to support attractive dividends. Thungela Resources shares may be suitable for some investors with a high-risk tolerance who are happy to have exposure to the coal sector. Personally, Id rather put my money to work in businesses with a more predictable outlook. Therefore, I wouldnt buy Thungela Resources shares for my portfolio today.