The RXL share price has underperformed badly for quite some time...

The RXL share price has underperformed badly for quite some time so we can conclude that we are launching from a low base to start with. What I like about the New Rox is that there is demand for RXL shares. If RXL can form a trading base of 1-1.5m shares demand per day, I can see that taking us to at least 35c per share in the medium term and much higher beyond that for the following reasons:

1) Those buying for a quick profit Vs investors

My hunch is that most of the buyers are buying into the Rox mine development story rather than looking for a quick exit. If that is the case there will be less shareholders flooding the Sell side.

2) Project Financial metrics

RXL is building a mine with a business case that will probably make $2b in free cashflow. It is not unreasonable to expect this to command a market cap well in excess of $250m.

3) The gold sector

Other aspiring miners have seen 2-3 bag gains (eg AAR) in a short period of time. I am sensing that confidence in RXL is improving and RXL still has a lot of catch up room vs some of its peers. Confidence can work wonders for a share price.

4) Regulatory risk

How many aspiring producers are fundamentally good to go? As an existing former operating mine, RXL is ahead of the game compared to many others in the sector.

5) Cash requirement

RXL is very well funded and also it is reasonably expected that the shareholder options will be exercised this year. Therefore, RXL will not need to raise funds until the FID. By then we will have a materially higher reserve, much larger production profile (Vs PFS) and a prolific cash generation profile. The price of gold will also likely be up rather than down.

I expect the share price to be closer to 50c than 30c at the FID point in time. There are many potential share price catalysts to put a rocket under the share price.