I actually don’t have a good response for you. I suppose my...

I actually don’t have a good response for you.

I suppose my original investment thesis was based on the soundness of the tech and attractiveness of the business model. From a macro perspective I also felt (and continue to believe) the industry has massive growth potential. However, I’ve always nursed doubts about Kalina as a company and recently these concerns have come increasingly to the fore.

My biggest concern is the ongoing project delays and engineering issues. They are usually mentioned very briefly and dismissively in the company reporting but they raise a red flag in my mind. I often wonder what the customer thinks about this. Are they frustrated? Unhappy? After all, the company’s explanations and justifications count for nothing, its only the customer’s perspective that matters.

Secondly, the management team seem way too focused on playing their never-ending games with options, share transfers, and back-room deals, etc. Its these things, rather than the business itself, which seems to be the key factor determining share price. The cosy relationships between the Pristine guys, Harringtons and Heartley’ also make me uneasy. The situation is very opaque,

Finally, the share price trajectory is alarming. Now, I don’t judge the value of a company based on where the price happens to be on any given day. But in my view a steady and consistent decline over a period of several months is potentially symptomatic of bigger problems in the company. Does the ‘smart money’ (insiders) know something we don’t know? If so, I can only guess what that might be.

So in summary, I definitely wouldn’t describe myself as a KPO bull, and I’m certainly not averaging down (looking at the buy queue, it seems none of us are). You may ask why I don’t sell. Well, it looks like we’re hovering around technical support (it might fall to 5c if 5.5c doesn’t hold, but I doubt much below that.) I’ll prob hold until the stock bounces to 7.5c or thereabouts before scooping whats left of my chips off the table and crawling off to lick my wounds