Dotz in detail - Fundamental Analysis

I have accumulated a decent position in this recently and wanted more before it jumped the gun on Friday closing on its high. I have spent this weekend going over all of the DTZ Ann’s and below are all the key points I like and are important. The potential here is massive. It amazes me that it still sits around $37m MC with only 49m free float.

Even Faldi reckons it’s time for DTZ in 2017 and going solely on all of their Ann’s then this could have an epic run if they can do what they think they can. A LT hold for me, I reckon it will be worth the wait IMO.

Great board, Otsana, world class scientist, high yield product, in negotiations, production coming or started, non-toxic, low cost producer (coal), small free float, IPO selling looks done, mass production capabilities, right space and right time, huge upside in multi-billion dollar industry…..etc.

The issue seems to be supply, which is why demand is so high and high end QD’s are worth $2.5m per KG. Another thing I saw in these Ann’s is that we are producing white, I can’t find anywhere where anyone in the world is producing white, are we the first?


Here is a recap of the announcements in snippets:

• Dotz Nano and NTU Singapore will establish the first Global joint research program focusing on the applications and development of GQDs, and the Company will have exclusive licensing rights to commercialise the developed applications.

• Dotz Nano and NTU Singapore will provide up to S$20 million in joint funding over a 5 year period.  In addition to the above financing, both parties will endeavour to obtain additional grant funding from other sources.

• Dotz Nano to have exclusive licensing rights to commercialise developed applications

• “We are extremely pleased by this partnership.  NTU Singapore is one of the leading universities in Advance Materials and in the research of GQDs, and this agreement demonstrates the significance of the research into the GQDs space and how the material will become of common use in the future.

• Dotz Nano brings to the market the next generation of nanoparticles, via coal derived GQDs with patented methods and commercial and technological benefits surpassing graphite derived quantum dots, which are costly and complex to produce, with both low yields and quantum efficiency.

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• Dotz Nano’s exclusive ability to extract graphene quantum dots from coal rather than graphite, allows the Company to produce inexpensive, non-toxic GQDs at ten times the production yield of conventional GQDs (currently ~25% yield coal derived, compared to ~2% from graphite).

• Dotz Nano will start to commercialise its technology between Q4 2016 and Q2 2017; falling in line with the Company’s expected first sales of GQDs.  The Company intends to be in a position to generate revenue through license fees and royalties in the short to medium term.

• Integrating the new Parr hi-pressure hi-temperature reactor, will allow Dotz Nano to produce up to 100 kg of GQD’s per year, and additionally produce specialised GQD’s adapted to specific applications that the Company is developing with GQD consumers.

• What’s so special about Dotz? The Company has the sole rights to extract GQDs from coal instead of graphite, producing cheaper, non-toxic and at ten times the production yield GQDs (25% yield instead of 2% from graphite).

• Dotz Nano is currently not aware of any other party that is commercialising graphene quantum dots.

• GQDs can create a shift in the applications market allowing traditional applications to use GQDs to achieve performance levels otherwise not considered possible.

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• Dotz intends to focus on the low cost/ high volume markets, targeting applications which require low to zero quantum yield

• Quantum dots are currently produced out of cadmium and other heavy metals.

• Applications which require high quantum yield (60-80%) – display market, photovoltaics, imaging, medical applications, pigments, inks, etc.

• Applications which need low quantum yield- casino chips, security applications, detergents, textiles, etc.

• Major commercial market DISPLAY MARKET QD based displays to improve colour and energy are starting to emerge (Sony flat screen displays, Amazon’s Kindle Fire HDX e-reader)

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• Early stage commercial market HEALTHCARE Currently the main market (tissue labelling, cancer therapy, tumour detection)

• Early stage commercial market PHOTOVOLTAIC & ENERGY QDs allow for increase battery efficiency and are currently in the R&D stage in energy related devices, such as photovoltaics, fuel cells and batteries

• DTZ solution: Innovative breakthrough process for producing GQDs developed in the lab of Prof. James Tour of Rice University in Texas. Based on extracting non-toxic GQDs from inexpensive COAL. Allows a large supply of inexpensive GQDs. Greatly reduces manufacturing costs, and 10 times greater production yield

• GQDs can significantly improve the appearance and brightness of colours, and in healthcare GQDs hold the promise for early cancer imaging and detection

• Milestone 3 – 100kg

• Over the next 12 months Dotz Nano aims to be a premier GQD producer. The Company is currently producing blue, yellow, green and white GQDs, with red GQD’s to come online shortly.

• Following six months of extensive research and experimentation, with verification by independent laboratories, Graphene Quantum Dots (GQDs) producer Dotz Nano has succeeded in developing new cost-efficient GQDs with a significant rise in Quantum Yield (QY) (>65%), adapted for large-scale manufacturing

• This new development is applicable to the high-end users of GQDs such as displays, TVs, solar cells and biomedical imaging, a market previously not available to Dotz Nano.

• Capable of large scale manufacturing

• Potential customers evaluating samples

• In applications that require a high QY, such as high definition TVs and medical imaging, QY is an essential parameter that is used to evaluate the light emission properties of the Quantum Dot.

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• The new process allows Dotz Nano to currently produce blue fluorescent GQDs with a QY of over 65% compared with a modest 5-8% achieved currently.

• For comparison, metallic based Quantum Dots currently marketed by several Quantum Dots producers’ and used for high-end applications as listed above, exhibit quantum yields of 50-60%. Standard conventional Graphene Quantum Dots when produced exhibit much lower QYs, usually in the 3-6% range.

• Several producers of high QY applications and products have received samples of Dotz Nano’s high QY GQDs to evaluate for compatibility with their application products that can ultimately lead to potential sales for high-end applications.

• “This development is a significant game changer for Dotz Nano.”

• The new GQDs have a QY comparable to metal based QDs but with the low cost and non-toxic properties of Dotz GQDs. This new development potentially opens new high value markets such as high definition TVs, medical imaging, lighting products and photovoltaics.

• Multi kilogram production capacity of the enhanced GQD is attained with existing equipment installed at Dotz Nano’s facilities in Israel and a potential manufacturer partner capable of mass producing the main product has been identified.

• Dotz Nano continues to undertake research and development for large-scale manufacturing of cyan, green and yellow fluorescent GQDs with enhanced QY and look forward to updating the market on these key technological developments as they unfold.

• Expansion of production capacity of GQDs up to 100kgs per annum in anticipation of sales pipeline over the coming months

• Commercialisation negotiations continuing

• Dotz Nano's production facility in Israel, is centred upon a 3 litre reactor capable of producing 100-200 grams of GQD’s per day or approximately 50kg per year.  Integrating the new Parr hi-pressure hi-temperature reactor, will allow

• Dotz Nano to produce up to 100 kg of GQD’s per year, and additionally produce specialised GQD’s adapted to specific applications that the Company is developing with GQD consumers.

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• Dotz continues to negotiate commercial contracts with potential customers for the supply of GQD’s and sublicensing of applications in accordance with its commercialisation strategy.

• The expanded production capacity will assist Dotz Nano in meeting demand in the interim period while plans for a larger production facility are progressed.

• With the integration of the new reactor and freeze dryer, we have expanded the Company’s capabilities of supplying future consumer demand of GQDs for any applications, both high and low yield quantum dots.  With our intensive business development and marketing efforts on foot, this reactor will be an important part of the GQD supply chain.

• Currently all GQD production worldwide is manufactured in milligram sized batches and in laboratories, none of which are at serious production levels.

• Dotz Nano is not aware of any other company in the world that is commercialising GQDs on a serial production status, especially in such quantities and quality as Dotz Nano."

• Further to the additional reactor, Dotz Nano has also purchased a Lyophilizer or Freeze Dryer that will allow the Company to ship GQDs in powdered form instead of solvent, thus creating an easier logistics solution for Dotz Nano customers.

• Dotz Nano and its US based manufacturing partner Pflaumer Brothers Inc. have been awarded a conditional AUD$1.2m (USD$0.9m) grant by The BIRD Foundation

• The purpose of the grant is to fund Quality Assurance Lab and Production facilities

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• The approval for the grant is valid for three months and subject to the execution of a cooperation and funding agreement between the parties

• Dotz Nano recently identified Pflaumer Brothers Inc as a potential US based manufacturing partner with facilities capable of producing the Company’s GQD products.  The receipt of the BIRD grant will be an important step in developing this commercial partnership further

• BIRD supports approximately 20 projects annually. The cumulative sales of products developed through BIRD projects have exceeded $8 billion. Since its inception in 1977, BIRD has approved over 800 projects with leading companies in the U.S., for example: ADM, American Red Cross, Applied Materials, Avaya, Bayer Pharmaceutical, Becton Dickinson, Bio-Rad Laboratories, Eastman Kodak, General Dynamics, General Electric, Guidant, IBM, J&J, KLA- Tencor, Molex, Motorola, Procter & Gamble, SanDisk, Spansion, Telcordia, Texas Instruments, Tyco and others.