Market Share/Price Analysis

Wanted to post up my analysis of the company to date and hear what others have as well.

First off, market cap. Going off the recent 2A I am using a figure of 2,601,628,168 shares. All of the listed/unlisted options (572,296,654) are in the money so I have erred on the side of caution and assumed they will all be converted and have added them to the existing shares on issue (2,029,331,514). This means at 9.5c the market cap is currently $247m.

Secondly, the opportunity in Australia. The company reported the estimated market for late payments from large to small businesses in Australia is $100b, however if you read the source that is listed (from Xero) then it is actually $115b. Anyway, once again let's err on the side of caution and assume the $100b listed in the presentation.

Thirdly, the margin the company makes is listed as 1.5%. They expect a 40% increase in their margin after signing the agreements with Fiserv/Visa/MasterCard, however once again let's err on the side of caution and assume it stays at 1.5%.

So the question really comes down to what percentage of the market ($100b) do you expect CRO to be able to capture. I've listed several percentages and the annual revenue that would be made on their existing margin (1.5%):

	Market Share	Transaction Value P.A.	Margin	Revenue P.A.
1	1%	1,000,000,000	1.50%	15,000,000
2	3%	3,000,000,000	1.50%	45,000,000
3	5%	5,000,000,000	1.50%	75,000,000
4	10%	10,000,000,000	1.50%	150,000,000
5	15%	15,000,000,000	1.50%	225,000,000
6	30%	30,000,000,000	1.50%	450,000,000

With the current market cap sitting at $247m my opinion is that future market share capture of ~3% is currently priced in. This is assuming they can make $15m NPAT off of $45m in revenue P.A. This would put the the estimated P/E at the current share price (9.5c) at 16.5 which is fairly conservative for a tech stock.

Interested in what others are looking at.