possibility of next institutional placement

folks:

anyone interested in digging out more of the likelihood / timing and process of next institutional placement ?

In the latest annual report ( year ended 30 Jun 18 ), the auditor Grant Thornton has drawn stakeholders attention to note 2 (y) of the financial statements (page 98).

On page 38, note 2(y) it says " if the Group is unable to raise capital in the future, the Group may need to curtail expenditures by scaling back certain research and development or other programs ".

This has set a tone for next institutional placement, we just don't known when and how.

here is my little calculation -- please use your wisdom to correct me if I am wrong which is very likely anyway.

As at end of Dec 18 , it has $30m in its bank. If it generates $1-2m cash on revenue each month , and spends $5m on management, sales , marketing , manufacturing and R&D, it has a loss of $3-4 m a month. Avita will need to plan for another institutional placement by end of March / April.

what I am trying to say is that Avita probably has already tapped shoulders of those sophisticated investors especially when they found out the monthly revenues since Jan 19 is less than $2 m . For example , Avita might contacted Karst Peak capital for next institutional placement. If this is the case , then Karst has all the incentives to sell shares to bring the price down , so they can buy them back at a very low and discounted price .

This might explain why Karst selling so much recently .

My guess is Avita will annuounce Q2 result and next institutional placement together -- a bad news balanced by a good news .