For those that dont and have just joined. Regal Asset Management bought a large chunk of shares (in their long short fund) when the IPO initially floated, they bought at 20 cents. If you go back and read the prospectus, it's a great read and the company looked very appealing based on what was known at the time. I initially bought a small parcel at that price too.
But covid supply chain issues meant that pent up demand from lock downs and lack of production during lockdowns (around the world) meant that supply was severley affected and demand was twice what it normally is.
Regal decided to exit and slowly sold into any buying pressure. They continually sold and held the price down towards 20 cents with each sale. See chart below. I was following it with the substantial holder announcements at the time. I think from memory they were all out by the end of 2022. They held so much stock that the price never stood a chance and created what was massive pessimism for years to come.
If you go back and compare the prospectus to now, where there was a huge buying pressure above 20 cents (except for Regal) - the prospects of the company are no different. Well actually, they are better now because SA1 is due to start construction this quarter. If you took that three year period of time out, and the balance sheet / income statement were the same, we would likely be around 30 cents right now.
Also, love that Michael Phillip, CIO of Tanarra Capital, is joining our board. How confident must he be about the DEL if he wants to help.
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