IPO - Youfoodz Holdings Limited - 8 December 2020 #, page-86

I understand and share your scepticism about YFZ to some extent, but I don't agree that YFZ is going broke in the near future. If it was going to go broke, it probably would've happened already. Now it's publicly listed it has greater access to capital, if they need more $ some greedy broker will raise it for them even if its at a discount to the IPO issue price. And with interest rates at zero there's more $ than ever chasing risk assets like equities, hence some of the silly valuations we are seeing. YFZ is a working capital intensive business so will undoubtedly have to re-raise in the future to fund further growth. Whether that's above or below the IPO issue price will depend on market conditions and management's execution. But they will get the $ they need.

Australia has a tendency towards duopoly and oligopoly markets with market power concentrated in the hands of a few. Retail grocery is a great example with WOW and COL having a combined ~70% market share. This makes it harder for small players like YFZ to compete. They aren't the only ones though; Coles recently bought Jewell Fine Foods out of VA. If Woolies or Coles dont eventually make a play for YFZ, one of the meal kit companies will IMO ie MMM or HFG.