This recommendation by the Companies Underwriter Baillieu is why I am a long term holder of Rex Minerals when as at 23rd November 2011 share price was $2.92 . The only thing that has changed with the review is the share price.
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RECOMMENDATION:
· We reiterate our BUY recommendation on RXM and price target to $3.50/share, ~120% above the current share price.
· Hillside is shaping up to be a large scale operation and is well located in respect of local infrastructure in the Gawlor Craton. Other regional players including OZ Minerals (Prominent Hill, Carrapateena), BHP (Olympic Dam) and the recent JV between Tasman Resources and RIO for the Vulcan prospect.
· In respect of news flow, we expect assays at Leprena in coming months followed by a further resource upgrade in Q1 CY12 prior to the completion of PFS in mid 2012. BFS and financing are expected in 2013.
· Financing will be the key challenge for RXM, with almost $1b required to bring the project online. However with limited new large scale copper projects coming online globally and China’s ongoing appetite for access to raw materials, we believe there will be significant interest to assist with debt, equity and offtake
E. L & C Baillieu Stockbroking Ltd Level 18 Gold Fields House 1 Alfred Street Sydney NSW 2000 PO Box R1797 Royal Exchange NSW 1225 ________________________________ From: Fiona McConnell Sent: Wednesday, 23 November 2011 2:46 PM Subject:
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