I asked TGR shareholders the following and I got a few answers, one below
They the same price of 12 months,ago.I was staggered when I saw investors pump $30 million into loss maker MCA on a fake promise (my opinion) they will be able to sell Murray Cod overseas at a premium price when they not really tested demand in Australia.Makes tassal.look.like a good buy yet why are institutions throwing money away at MCA that has me stumped.Can anyone here give me their insight into why if it was really so profitable why has,Tassal not gone into that sector.TGR Price at posting: $3.39 Sentiment: Hold Disclosure: Not Held
one answer
I see Murray Cod (and Clean Seas) as more niche, or specialist aquaculture companies, where as Tassal (and salmon as a product) is more mainstream.From my research, salmon is an incredibly good product to farm, most sustainable source of protein (despite what the Environment TraitorsTasmania people say). No other species of finfish is comparable to salmon.No doubt there is a place for other species, but Murray Cod and Clean Seas need to develop their market as they grow, where as salmon is more established. Their costs are higher than salmon because their volume is lower, so they have higher overheads and distribution costs.I think a speciality product could be a good addition to Tassal one day (one of the above, or barramundi), there would be synergies with our overheads, experties and distribution costs, but Prawns is such a good expansion plan it has to be the priority. Prawns are filling domestic demand rather than export which reduces risk, and because its earnings are mostly in H2 so it complements salmon whos earnings are skewed towards H1.On the SP, i feel if it stays suppressed like this for long enough we will be become a takeover target to an overseas player who trades on high multiples, if Australian investors dont put a fair price on Tassal, someone else will, it is the way.
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so basically I can't see how MCA will ever make a profit for 10 years yet institutional.investors put money in to an unprofitable business employing 72 staff I believe it is.. tassal not doing much better except they still making a profit but sliding a little with no growth in share price.
BCA is looking more like AfterPay the more They lose, the more the more investors,will put in, so maybe an institutional investor can advise why they put $30 million into this one? Did you study the real market for Murray Code or did they just take the opinion of the positive sales and marketing men? My research seems different but looking to check why it different.
Cheers.
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