Member Info for Balanced66

Maximum conversion price of 3.7p and low of 1p! At the low it could be around 20% dilution. Be prepared for a crash in the share price once the suspension is lifted as the placing price is going to be at a big discount to the suspension price imv.

Eqtec by all appearances was a fraud or an extreme example of a lifestyle company. It never delivered on anything and as such it's patents are worthless. Lost 99.99% of its value over 5 years!! Since the "pivot" into the mining business it's lost more than 50% of its value again! The only people who got rich from it or made money from it are the directors - the former CEO is now living the good life in the UAE. Lol. The company should be investigated by the authorities but nothing ever happens. Lot of similarities to Clean Power in the alleged "superior" product that doesn't get adopted by anyone.

Https://finance.yahoo.com/markets/commodities/articles/cerrado-gold-granted-injunction-lagoa-100000899.html

And the last bit from the ai:

Could it multibag from here?

Yes — small diagnostics companies can move sharply if:

they become profitable,

land major contracts,

launch successful products,

or become takeover targets.

But that is different from saying it returns to £10.

More realistic long-term scenario

If execution improves materially and the company stabilises, something like £1–£3 over time feels more plausible than a full return to pandemic highs. A move above that would likely require a genuine step change in earnings.

The key thing to understand

The £10–£12 price was not “normal value.” It was a pandemic bubble price based on extraordinary one-off profits and retail speculation.

A lot of investors got trapped by anchoring to the old high and thinking:

“If it was £12 once, it can go back.”

But the underlying business today is completely different from the 2020 earnings machine.

If you want, I can also do a valuation-style analysis of NCYT today (cash, enterprise value, revenue multiple, upside/downside scenarios) and compare it to similar diagnostics companies to see whether it actually looks cheap at current levels.

Just noticed that the post below (12.56pm) was not complete. Here's the missing text.

The question investors asked was:

“What replaces £277m pandemic revenue?”

So far, the answer has been: not much yet.

Novacyt has tried to pivot into broader molecular diagnostics, reproductive health, genomics and instrumentation, including the acquisition of Yourgene Health and more recently Southern Cross Diagnostics. But revenues remain far below pandemic levels and profitability has not returned. �

Investegate +1

2025 revenue was only around £20m, versus £277m in the boom year. The company remained loss-making and continued burning cash. �

ADVFN +1

D) Capital allocation concerns

One criticism from investors is that management had a huge COVID cash pile and struggled to deploy it into high-return growth.

Instead of a clear transformation into a profitable diagnostics platform, Novacyt has looked more like a turnaround story trying to stitch together acquisitions while cutting costs.

Recent workforce reductions (~40%) suggest management is focused on stopping cash burn and reaching sustainability. �

The Times

3. The bull case (why some investors still own it)

There is a recovery case.

Positives include:

Cash and no debt

Novacyt has historically had a decent cash position and remains debt-free, which reduces bankruptcy risk. Although cash has been falling, it still provides time to execute a turnaround. �

ADVFN +1

Diagnostics is a real market

This is not a shell company. It sells molecular diagnostic products, prenatal testing, instruments and lab solutions.

Acquisitions could eventually work

The acquisition of Yourgene was intended to diversify away from COVID and broaden the business into reproductive health and precision medicine. If management executes well, there is a path to a stable mid-sized diagnostics company. �

The Times +1

Extremely depressed valuation

At current levels, some investors argue much of the bad news is already priced in.

4. The bear case (why many investors avoid it)

The problems are significant:

Persistent losses

Cash burn

Falling investor trust after years of disappointment

No clear evidence yet of strong organic growth

Competitive diagnostics market

History of “jam tomorrow” narratives after COVID

The key risk is that cash continues declining faster than the business improves, eventually leading to dilution (raising money at low prices).

5. Will NCYT ever go back over £10?

This is the big question.

My probability view:

Back above £10 in the next 2–3 years: low probability (perhaps <10%)

Why?

At £10+, Novacyt would likely require a market value many multiples above today’s level. To justify that, the company would probably need:

Revenue growth back into £100m+ territory

Strong profitability

A major breakthrough product or platform

Successful international expansion

Renewed investor confidence

At the moment, Novacyt is generating around £20m revenue and losses, so that is a very large ga

Seems like some investors are still thinking about Nova in terms of what it was and no what it is now. The past isn't going to repeat itself and any investor needs to look at the company as it is today. An ai perspective:

Novacyt (LSE: NCYT) is a classic case of a company that experienced an extraordinary, probably unsustainable windfall during COVID and then struggled to reinvent itself afterward. To understand whether it can ever go back above £10, it helps to separate what happened, what went wrong, and what the business looks like today.

1. Why Novacyt went from pennies to ~£12 during COVID

During 2020, Novacyt became one of the earliest companies to launch a PCR COVID test and secured major UK government contracts. Revenue exploded from a tiny diagnostics business into a pandemic cash machine. In 2020 revenue jumped to roughly £277m, versus only ~£11m in 2019, and profits surged. Investors treated it like a high-growth diagnostics winner and piled in. �

Investing.com UK +1

The market started pricing NCYT as if:

COVID testing demand would remain elevated for years

Government contracts would continue

Pandemic profits could be converted into a much larger diagnostics company

Excess cash would fund acquisitions and growth

At the peak in late 2020, the share price touched almost £12, giving it a market value approaching £800m+. �

The Times +1

The problem is: most of that valuation was built on temporary earnings.

2. What went wrong?

There wasn’t one single event — it was several blows stacked together.

A) COVID demand collapsed much faster than investors expected

PCR testing demand was enormous in 2020–2021, but as vaccination rolled out and emergency testing faded, demand dropped sharply.

This meant Novacyt’s profits were not recurring. Revenue fell dramatically after the pandemic boom. The market began re-rating it from “growth company” to “shrinking ex-COVID stock.” �

StockAnalysis +1

A common pattern with pandemic winners is that investors anchor to peak earnings instead of normalized earnings.

B) The UK Government dispute destroyed confidence

This was arguably the biggest psychological blow to the stock.

In 2021–2022, Novacyt entered a major dispute with the UK Department of Health and Social Care (DHSC) over a £150m testing contract. The government later pursued claims over allegedly defective test kits, while Novacyt disputed the allegations and counterclaimed. �

The Standard +2

Even before the final settlement, this created:

Legal uncertainty

Fear of a massive liability

Concern over management credibility

Reduced confidence in future NHS relationships

The case was eventually settled in 2024 for £5m with no admission of wrongdoing, which was far better than the worst-case fears — but by then, much of the damage to investor trust had already been done. �

The Standard +1

C) Failure to replace COVID revenue

This is probably the core investment issue.

The question investors asked was:

“What replaces £277m pa

Hard to believe but true. Most people have heard of Paul Scott of Sotckopedia fame; he now has his own substack ( that's the sort of investment analysis that people need to learn or follow to assess and value companies). His background professionally is an Auditor. Yet he blew his £millions of profits during the dot-com mania. It can happen to any rational being when irrationality takes over!

https://www.sharesoc.org/blog/education/cautionary-tale-paul-scott/

It can be investing if people approach it properly or it can turn into gambling if done wrong.

Many similar cases of retail investors being wiped out due to greed and lack of investing knowledge. One of the Telegram groups I'm in a regular poster mentions his cousin who was up to £250k on crypto last year and never sold and now he has nothing left. Another example:

https://x.com/i/status/2063188826755879245

I agree there's no point posting the same thing on this chat board nothing is going to change, the Directors took their bonuses and that's that. It's always about what you can salvage. £50k or whatever remains is still a lot of money and worth having.

I had a big holding in NCYT at the time and was bullish on it for the next few years but sold everything on the vaccine news - that was definitely the time to get out as the story changed.

Can happen especially with those with specialist backgrounds. I've seen that before when doctors and those with a scientific background invest in pharmaceutical stocks, quantity surveyors invest in engineering and outsourcing stocks etc. This is a another classic mistake - people in those fields get blinded by the science and don't understand the investment case too well which may be less promising.

At the height of the pandemic many thought these stocks were going to multiply many fold even from £10. The owner of Stockopedia was buying or holding stock when it was £10 and thought it would go higher and there were other well known investors holding as well.

Greed does often get the better of people. When someone has invested so much it's hard at the time to sell at a £100k, £200k loss etc; with hindsight it would have been better to sell and keep the bulk of the money.

It appears to be a genuine case of financial loss as hard as it is to believe and as stupid as it is - he has been saying this now for several years from recollection, the persistence makes me believe it is a real case of loss.

Yep not going to help now but investing such a large sum in one small AIM stock is a no-no in investing circles. While I sympathise and understand how he may have been lured into putting everything in one stock, it's a newbie mistake and part of the blame has to be accepted by the investor for such a basic error.

Good advice from Wayne. Doing due diligence on management is part of the screening criteria for choosing stocks. Directors are suspected of making such statements especially on AIM and for disclosing information late.

Best approach is to diversify, invest in a mix of index trackers, ETF's, investment trusts and managed funds and drip feed regular amounts rather than big lump sums. Also, have only small percentages invested in small companies. You're less likely to lose all your money with mid caps and blue chips.

The key thing is not to lose too much money as that knocks you out of the game.

To rely on the statements of one company or their directors as truth is a recipe for disaster; I'm not making a criticism, this is something that new investors aren't aware of. It's something I've also experienced from some of these unscrupulous small company directors who just spew out unreliable statements.

Unfortunately, no one is going to take action against them. The whole system is set up in their favour.

This just looks like a poor investment. As I've mentioned on the Prim board before ( they put a £1m into this stock at 40p) the company was and still is very early stage. It basically listed to obtain funds to develop its product. It should have done all that and proved the product before listing. It took investors money and squandered it and in the end the product failed to be viable.

There's no conspiracy and who would seriously take over the company with unproven and undeveloped tests?

Another example of AIM market excess.

Covid was a one off. Companies always revert to mean share price trajectory over time. This went no where for many years before COVID and without any new groundbreaking high selling products the sales are going to be low as in the past. These share price pumps should have been used by those underwater to sell. It's better to have 10% of something than nothing at all and that will become part of the regret later on - " why didn't I sell my remaining holding...".

Just hoping for a miracle is a lousy investment thesis. Can understand traders but anyone holding long term will most likely see an erosion of value over the next year or two and placing is likely at some point.

Disaster at Clean Power Hydrogen. £1m was invested! That's a huge sum for a small company like Prim. That will have to be written off. Too many failed investments. This stock should be wound up it's not delivering anything. Companies invested in are too early stage. Meanwhile look at CWR and ITM how they've powered ahead. This early stage start up investing is a failed strategy.

Just keeping the money in GGP all those years ago would have provided a better return. Lol. Shame they never reinvested back into to GGP at the lows.

A lot of novice investors jumped on to the bandwagon during COVID. They had likely never invested directly in shares before.

One of the main novice mistakes is to put all your eggs in one basket.

Buffet says: "Never lose money." His second rule is: "Never forget rule No. 1".

If you lose your capital then it's the end of the road. Nova was always a high risk company at the time it was making all these millions as the vaccine breakthrough was just round the corner and it was ultimately a one trick pony.

Professional investors would always see this as a high risk play as it was a small company with a history of low static turnover and losses running into millions every year over many years.

As a new investor I also made the mistake of investing disproportionate amounts into these risky plays but I never put everything into one stock. Nowadays I try to limit any one stock's weighting to no more than 5% with most stocks around 2-3% of the portfolio value.

People really need to look at the advice given about portfolio construction and also diversifying sectors.

This is really the downfall of most private investors. Yes, many directors will look after their own interests over those of shareholders and this is a disease common on the AIM market. As novices we will be taken in by the hype and pay dearly for it.

We should get rid of these motions of getting rich overnight and many might be better served by trusting their money to professional fund managers and looking to double our money over 5-7 years and/or until we develop sufficient skills to invest directly ourselves; imv this will take at least 5 years to achieve to get to a decent understanding of what to invest in and what not to.

Keep hearing about Fresho doing well. Yes it may be opening new operations for example the recent expansion in the US but the sales figures are abysmal. Now you have a strong chance of a recession coming.

Prim has gone nowhere for many years while we have experienced a raging bull market in stocks.

Take out Fresho and there is nothing else that is worthy of note.

GCC - Gulf Cooperation Council countries, so Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.

Birdsong

Yes the US, which incidentally has started the most wars in history and is the only country to ever have dropped nuclear bombs, could cripple Iran for many years. However, Iran's aim in this war is to inflict severe damage on the world economy and only a few weeks into the conflict it has already done that with nations scrambling for oil and gas. For Iran this is a war of attrition and it has said it can go on for months, the US and Israel cannot afford to. Get ready for a major world recession/depression. Iran has said it will continue bombing Israel and the GCC bases etc even if the US walks away without meeting its terms of settlement.

No US president was foolish enough to fall into this trap until Trump did so. This will end badly for the world and it's the people that will pay the price for the war.

You had China also saying yesterday that the Yuan should become the world's reserve currency.

There has been lots of talk that China actually have more gold reserves accumulated than the US - possibly up to 30,000. All speculation but most agree it's much higher than the official figures. Imagine if they ever announced such reserves it would put a rocket under the gold price.

Also Julie Shelton (former Trump economic advisor) did an interview with Miles Franklin Media and said that on 4th July he will back some Treasuries with gold.

I suspect that the US government has been a heavy buyer of gold behind the scenes.