Why is REX so quite. Hibiscus up by 0.16 last two days. Hibiscus n REX is controlling 35% and 65% of Lime Petroleum and will start drilling for oil in Oman between middle Oct & Nov 2013.

UOB KAY HIAN says...

REX INTERNATIONAL | BUY | TP: S$1.47

We initiate coverage with a BUY and target price of S$1.47 (based on expected monetary value of Rex's exploration assets using forecast from traditional geologist findings), representing a 58.1% upside
Rex's most valuable asset is its access to the proprietary Rex Technologies that may significantly improve the odds of successful oil exploration
With more than 80% accuracy in blind and live tests, Rex Technologies showed great promise and has helped Rex to secure strategic partnerships and concessions
Results from Rex's first few exploration wells will be critical and is a potential catalyst
A successful oil discovery may see a re-rating of the stock
Results of the first exploration well are expected to be known by 1Q14
Using proprietary satellite and seismic imaging technologies, management believes Rex Technologies can produce an exploration success rate in excess of 50%, compared with a global average of 10-15%
In addition, Rex Technologies also cuts the exploration process to 18-60 months from the 72-114 months required under conventional technologies
Rex has conducted blind tests for Hibiscus and Fram and has shown an impressive 100% accuracy
Over the past two years, Rex had analysed 59 prospects for North energy, accurately predicting 35 of the 41 wells that had been drilled (85% accuracy)
Rex successfully predicted 24 out of 25 dry wells and 11 out of 16 commercial oil wells
As Rex Technologies gains traction among market players, Rex has been able to secure concessions on better terms, such as eliminating common industry practices of paying entrance fees
With its leverage, Rex has successfully farmed into 15 concessions ASX-listed Bass Strait Oil Company (BAS) is Rex's newest strategic partner as it partners with REX to reassess specific exploration opportunities in Gippsland Basin of Australia
A potential multi-bagger with exploration target of 2,183mmbbl unrisked resources (EMV range: US$1.31-5.39/share)
Oman Block 50, Rak Offshore and Sharjah Central form almost 90% of our total risked NAV, and are estimated to have a risked value attributable to Rex of US$1,319m (US$1.31/share) based on conventional chances of success
To derive our target price of S$1.47, we applied a 20% discount to our risked NAV to account for the concentration risks from Oman Block 50, which forms almost two thirds
of our risked NAV estimate