Things move pretty fast over last 3-4 months following events have occured with BOT:-
Positives in last 5 months:-
- Sales team is up and running
- Management is running the commercialisation as per schedule and on time
- Management had to do a capital raise in April after seeing uptake of SOFDRA and had to do the capital raise quickly as they were running short of time and capital as mainly due to timelag with sales and relisation of cash
- Directors had confirmed in the con call after capital raise that they might look at working capital loan facility (to avoid any further dllution)
- Management have confirmed that Trumps pharma policy will have no impact which makes sense as SOFDRA is only approved in US
- Working capital loan has been received and approved which is the biggest news as any one giving debt facility would see the financial and operating convents and for further raise this will be again checked. Normally latest set of financial metrics would have been provided and since it is Blackrock owned business they would have done due deligence on the same in pretty detailed manner.
- HC Wainright acted as placement agent for the transaction of working capital loan and couple of days after put a price traget of $2 which might be bit aggressive unless they have seen something which is only privy to them (sales numbers after March quarter) whcih is more than 6.5x of current closing price
- EH have a price target if $0.8 whcih is 2.5x of current price which might revise as well after next quarter sales numbers.
- Unisuper is a major shareholder owning more than 5%
Negatives:-
- Share price was doing fine until Trump pharma poilcy news kicks off sell off and seems all the new shares issued were getting sold off and short position increased (alltough managment have confirmed that it should not have any impact)
- Since becoming part of ASX 300 shorting has increased it is between 3-4% which is not a significant number and might go down is sales number start to pop up in the coming quarters.
- Dillution of shares - this was required at the intial stage but I would like to see company doing something about this as number of shares on issue is quite high are leading to malpractice. At the moment management might not be able to do much about it but if they are genearting good profits in next 1-2 years then buyback should be considered as prudent activity (it might happen that this business might be sold out before that time eventuates, only time will tell)
Considering all the above factors I don't think share price price reflects true picture and efforts of the BOD and management, it should have been north of 0.60c but it is what it is, if management continues to beat its goals/ target and overachive then I don't see a big rerate too distant in the future.
(20min delay)