A quick few thoughts ahead of more news :
1. What would be the point of raising more capital just for the sake of it right now ? I would dismiss that and hope it isn't happening.
2. The recent Market Update showed very good progress, but we are still only seeing strong growth off a relatively small base, not break-out growth, and break-out growth is what VMY should now be looking for. Otherwise it will get left behind as the market for E2Vs explodes.
3. I like VYR's stab at 30,000 units for FY2020, but we could then be looking at 100-150k in FY2021, 350k in FY22 and that trajectory would put us out of production capacity as early as 2023/24 ! Sounds like a lot of units, but in the short term simply assess all those new distribution agreements under discussion, then put unit sales against each of them and it's not so hard to build-up the case for investing in new capacity sooner rather than later.
4. In my view that capacity needs to be outside China, and should be built before the China capacity is too stretched. If you wanted to do it in Europe then (eg) Poland might be a good option, but as most of you know my preference, which I have expressed more than once before, would be India.
5. Why India ? Well its population is only a little less than China, providing a huge domestic opportunity to support a JV partner. Although it has its faults, India is a democracy, the current leadership is overhauling the commercial sector, international relations are generally good, English is the common language, and there is good infrastructure for foreign firms. (Plus they drive on the correct side of the road, play a good game of cricket and so on !!)
6. By contrast, in much of the World 'made in China' is fast becoming a negative, certainly in Europe and the USA, so VMT needs to get away from its 'Chinese Bike' image. Diversify the manufacturing and then emphasise Australian Design !
7. Although I understand the benefits of the link with Ducati, this gives credibility and image rather than volume. So whilst we need to nurture that relationship the real need is to focus on 'bread and butter' volumes into both the B2B and B2C markets.
I am hoping that when all is revealed the Capital raising will be for expansion of production, and the cherry on top would be if they are making the bold move to go for a manufacturing partnership in India, though it could be elsewhere. They might even go for a foreign listing to raise future capital.
We will know very soon. Best to all. 2000.
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