Hi all. I have just re-read the research given the events of the...

Hi all. I have just re-read the research given the events of the last few days. This report only went to Insto's which will account for why hardly anyone has seen/read it. I make the following observations:

1. The author, Ivor Ries has a price TARGET of 64c - Not a valuation.
2. On Pg 5 there is an Enterprise Valuation table which gives a mid case Enterprise value of 97c
3. The 97c is based on fully dilluted issued capital of 350m shares which is clearly way too high. Total issued capital post this raising and SPP will be ~260m - fully dilluted.
4. Using 260m shares the mid case valuation rises to $1.31
5. Ivor does NOT apply any free cash flow to the furure development of the projects - this too is clearly conservative. If you are succesful, you will create revenue/earnings which is part will be used to grow organically.
6. The report was issued on 16th March. Given they are the broker to the SPP I assume they will have an updated version out to their client base before the SPP finishes next week.
7. I am expecting the price target and mid range EV to increase given we now know how much new stock has been/will be issued.

Also keep in mind that the price action over the last 2 days was indicative of retail sellers taking profits at current levels on the assumption they will replace their stock at 32c. This will not happen. They will get some but scale-backs and over subscriptions will mean they wont get much more than $5k I suspect.

Last point: All the nervous sellers and arbitrage sellers have to have sold by this Friday to get their money T+3 to pay for what stock at 32c they get allocated. That means, next week RFE is going UP as the selling pressure eases.

Take care all.

E