Netscientific Share Price (NSCI)

Always followed and invested in this company, but very long term for me, you can see the progress happening on multiple fronts, and I trust and respect the work the CEO is doing.

Good news, Hope Ed can help execute some of NSCI's plans.

"to prepare and deliver exit and liquidity events for them, as part of the Company's planned strategy to realise shareholder value and returns."

https://www.proactiveinvestors.co.uk/companies/news/982721/netscientific-appoints-experienced-city-lawyer-as-general-counsel-982721.html

someone is shorty of stock.....

One of the inflection points came sooner that I expected! In my posting last week I complained that the presentation was "numbers light". I've now had a chance to study the numbers and drew a number of interesting conclusions:
1. The NAV is higher than the market price. So NSCI trades on a 5% discount to NAV.
2. The fair value (i.e. the Venture Capital Association assessment methodology) put the discount at 45% (as at 31/12/21)
3. The AuM with 15%-20% profit share of outperformance above 10% could be worth a lot if there are any serious outperformers.
4. Many if not all of the stakes appear to be convertible loans. This means that if the investee does badly NSCI is ahead of other investors plus earns interest from that investee. If they do well then the loan (and interest) can be converted to equity. Looking at the fine print there's an intelligence to how these have been structured.
5. There's a lot of technical signals (e.g. RSI) pointing towards a reversion to the mean of Biotech. It should be remembered that while Biotech is risky, healthcare is not - it's defensive. If a treatment can get to a successful phase 2 outcome it is then possible to sell it at an uplifted value (without having to fully commercialise it yourself).
6. Liquidity - assuming the business had to batten down the hatches it has liquid resources to survive 4 years with zero cash realisations. This is through a mixture of cash £2.7m and liquid investments £6m.

In conclusion I feel happier having read through their results and my earlier concern at how those results were presented has reduced. Understanding the statutory loss and adjusted profit gain was comforting and the analyst expectations of £1.50-£1.80 seem reasonable as we see further positive news flow.

GLA