Hi Nitpicker, sorry on account of the lagged response. However,...

Hi Nitpicker, sorry on account of the lagged response.

However, in the event, Moneyinmouth seems to have read my mind.

I didn't specify this in my last post, but the prospect of a second factory was also at back of my mind when I posted last time.

Earlier this year, I contacted the company and put the 'factory' question to them directly. I've pasted the response I received below:

...It will be ideal to have a factory in a different region but it depends whether the local sales units is able to sustain a manufacturing operation locally and whether there are suitable policies and partners to manage the operations locally. We focus on growing sales and profits at the moment and when the time is right, I believe it will happen naturally...

I was actually a little taken aback as to how frank the response was, I half-suspected that they were going to brush off the question.

While I had no way of knowing how candid that response was, not long after I received the response, the company announced the deal with the Italians.

To my mind, the growing cultural diversity in the ranks of the senior management would seem to add some credence to the notion that the management of this company are seriously mulling the possibility of setting up a new factory beyond Chinese shores.

While Vmoto would ideally want to increase their unit sales before they commit to a new manufacturing facility, the timing would seem to be opportune.

In the United States, gas prices just hit a new record high, $5 a gallon, with many analysts convinced that it could hit the $6 mark in a matter of months. Certainly a positive backdrop for sellers of electric two-wheelers, and just as Vmoto seems to be starting to pivot towards the US market.

Additionally, in the US at the moment, there is a significant push towards 'reshoring' or 'nearshoring': shifting sources of industrial production from Asia to either the USA or Mexico to minimise supply-chain risks, with many major US companies having already opted to swap Mexico for China as their primary supply source.

A factory in Mexico would provide a convenient base for the company to expand into the major US market. Mexico, a relatively young nation (the birth rate peaked as recently as 1994) with a population exceeding 120 million and promising economic growth prospects, also represents an attractive market by itself.

Pods complained earlier about this thread going off-topic, so for the moment, I'll get back to the theme of this thread.

I actually don't think the Getir example (raised by the poster who kicked off this thread) is really representative of the food delivery market as a whole.

The couriers working for Getir are employees, which means that the company bears all of the delivery costs, which of course, are rising given that the inflation genie seems to now be out of the bottle.

Of course, couriers working for many the major food delivery groups are operating under a very different structure. As is well known, the food delivery riders of the two behemoths of the industry, Deliveroo and Uber Eats, operate as free agents, effectively freelancers.

The media often paints a bleary picture of the working conditions of these independent delivery riders, but the true picture is somewhat bifurcated.

There are some advantages for the riders: the freelance rider, for example, can pick and choose the jobs that they take, the times they want to work, and can opt to knock back jobs that are in dangerous neighbourhoods, or hard-to-get-to places.

But one of the genuine downsides is that such operators are carrying all of the on-the-job overheads, which of course includes petrol for those who operate by motorcycle. That effectively means that the freelance courier has a significant incentive to make the shift to electric when faced with surging petrol prices.

In the face of high petrol prices, swapping a gas-guzzler for an equivilent electric model is a no-brainer. According to one report from Europe, the cost of a full recharge of an electric scooter was 0.20 euros, compared to 10 euros for a full tank of petrol (the report was from last year, the difference would be more significant now). At any cost, the difference ends up in the pocket of the rider at the end of the week.

In the wash-up, while the surge in inflation and energy prices is painful for groups such as Getir, thus reducing Vmoto's chances of securing a contract from such companies, if you flip the coin around, the same trend is likely to actually increase demand from couriers working for the platforms such as Deliveroo and Uber Eats.

These freelancers bear all the costs associated with their work, and thus naturally have every incentive to ditch a gas-guzzler for an electric two wheeler.

The increased demand from these freelancers isn't something we are going to hear about in an announcement, it would be happening below the radar, but all the same, if the trend is taking place as expected, it will flow on to increased sales and should offset the potential loss off contracts from groups such as Getir.

Before I wind up this post, there was something else that I thought might be timely to raise.

The last time I posted on this thread, the forum was about as lively as a graveyard: there had only been a single post over the three previous days.

I found it curious that the first response to that post popped up on the thread just twelve minutes after, and a non-specific, generic post two lines long. Not long after that, a newbie poster, with hardly any track record on Hotcopper appeared out of the blue and re-booted a new thread.

Indeed, I couldn't help but notice that this thread was also kicked-off by a poster matching the same description.

I suspect keen-eyed followers of this forum might have picked up on the pattern described above.

I am not entirely sure exactly what it is, but over the years the VMT forum always seems to become a magnet for theses shenanigans.

Years ago, the main culprit was a disgruntled shareholder, who had a beef with the Chinese management and used a number of accounts on the platform to harass any posters who expressed a contrary disposition.

Eventually, this unhappy lurker faded away, but as he retreated, another shareholder, possessed of a more chipper sentiment, started to pick up the slack.

One thing I'll say for the negative-neily, is that at least he was only using a few surplus accounts. The new guy seems to have a veritable 'dirty dozen' up his sleave, or at least this seems to have been the case since late 2020, when the forum started getting spammed with sus accounts.

You often notice such accounts will appear out of the blue and kick off new threads to disrupt the forum; the most recent example I noticed was one just last week.

I think the guy who is behind this perceives this as an attempt to 'ramp' the company, but in practice it often seems to devolve into an ego-driven thing: it is hard to otherwise explain the constant disruptions.

Lest this be mistaken for a rant, there are actually a couple of good reason as to why I am airing this now.

Firstly, someone recently posed the question as to why it was that the VMT share price had gone nowhere in two years.

I find it curious that this time-frame coincides with the ramping-up of the activity described above, I noticed it becoming much more frequent over 2020. Given the lacklustre shareprice, you'd have to conclude that this effort has been largely a waste of the time of the person responsible.

Indeed, you'd have to wonder if their efforts have backfired. Perhaps all the disruptions are driving people away from the forum, resulting in less interest in the stock, more selling, and less buying.

The second reason I raise this is of weightier significance.

Just over a week ago, someone ended up getting bagged after they had the book thrown at them by ASIC on account of market manipulation. Apparently, this is the first time it has happened.

...A Melbourne share trader who used online posts to pump up share prices, then sell them for inflated prices, has become the first person in Australia to be convicted over a “pump and dump” scheme.

**iel Govida, known online as Fibnarchery, used 13 different share trading accounts in the names of friends and relatives to manipulate the share price of 20 different listed stocks, between September 2014 and July 2015.The 41-year-old traded between the accounts he controlled – known as wash trading – using dummy bids to falsely boost the perceived demand, and ultimately the price, for listed stocks.

He used online posts on HotCopper to illegally spread information about his wash trades and dummy bids, seeking to pump up share prices, then sell them at a higher price....

The person mentioned there would be familiar to long-term users of this site, I believe he was one of the 'red hearts'.

In relation to the case, last week, ASIC released a note in relation to the use of 'pump and dump' activities'. Here is an extract below, you can find the full details on the relevant site:

...In one HotCopper post, Mr Govinda stated “dummy bids are all part of the fun and games and cat and mouse of the stockmarket!". This is the first time a person has been convicted of charges under s1041D of the Corporations Act.

ASIC has noted a concerning trend of social media posts being used to coordinate ‘pump and dump’ activity in listed stocks, which may amount to market manipulation in breach of the Corporations Act.

‘Pump and dump’ activity occurs when a person buys shares in a company and starts an organised program to seek to increase (or ‘pump’ the share price. They do this by using social media and online forums to create a sense of excitement in a stock or spread false news about the company’s prospects.

They then sell (or ‘dump’ their shares and take a profit, and other shareholders suffer as the share price falls.ASIC has recently observed blatant attempts to pump share prices, using posts on social media to announce a target stock, a designated time to buy and a target price or percentage gain to be reached before dumping the shares.

In some cases, posts on social media forums may mislead subscribers by suggesting the activity is legal...

The key take-out here is that ASIC are starting to pay attention to Hotcopper.

Earlier in the year, in one of my posts I made a reference to the guy who was spamming the threads with the bogus accounts. Based on his response, he seems to taken the comments as a personal attack. This certainly wasn't my intention.

The intent was rather to signal to the poster that what he is doing is far more obvious than he seems to realise. And, as highlighted above, the use of duplicate accounts on stock forums is potentially illegal.

If I can spot it just by following a forum for years, you'd have a snowflakes chance in hell if a government body like ASIC starts to take a closer look.

Personally, my main gripe with spoof accounts is simply that it is are a waste of everyone's time, as most of what they post is vacuous rubbish, and in general, I don't think they are particulalrly effective in boosting the share price of a stock anyway.

But while I find this practice irritating, I'd rather not see someone here end up in legal strife on account of something as silly as this.

Based on the goings-on I have seen on Hotcopper over recent years, it is clear that many posters are far too complacent about this, and I do wonder if the rather questionable benefits are really worth the risks they are taking on.