5x Bag, page-36

A pretty impressive day from LBY today given the sea of red. Traded above deal price all day, if it was going to break deal price, today should have been it!

The retail SPP allotment date is this Friday 25th June, with quotation on Monday 28th June. The last overhang on this stock from the recent CR transaction

My expectation is that allocations will be 100% of subscribed amounts given the $5mln size of the SPP which is large for a stock that has underperformed so significantly. I do think that the people that are in the SPP will be genuine holders over the medium term. So I am not expecting any selling post allocation.

The complete transaction has taken over a month, with a record date back on the 18th May. This is a pretty long time given it was a dual-tranche deal with an SPP. Given the length of time, the deal was scheduled to take, most insto's will be waiting for the backend of the deal before adding further on market.

Additionally, if there is any remaining tax-loss selling to go, it will have to be complete by next Wednesday 30th.

Last month-end we saw a pretty big effort to window dress this stock from the Hedge Funds, I would expect a similar run-up into very little liquidity once again. This time, however, I do not expect the stock to trade lower post month end

Structurally LBY is lining up for a potentially strong re-rating in the coming weeks, further supported by a sector that is seeing fresh investment.