Member Info for Dartron

5h, Nothing will change to your ISA. If new shares were issued, they would presumable be given to the asset seller. It would be no different from a placing where more shares are issued. You still own your shares, just the total share count increases. If anything happened like a new ticker, or a share swap, all this would be transparent to you and your ISA. I am not saying there will be more shares issued, just answering a question about shares in a ISA.

I am already up 5% here, before any return of equity. While the NAV discount has narrowed a little, the NAV has also increased and ticked up in to the 66p range. HSP and SNX doing well last week. Downing have reduced on 2nd Feb, HSP to from 4.97 to 3.89%. SPEC also recovering (as expected). This is probably what has helped the NAV over last week. JNEO results were good, it dropped on release. However, it looks like we were exiting in the build up to results, so a positive there too. VLX looks set to break out. No major downers over last week, though obviously there are a few laggards in the pf. This is why a managed winddown is in our best interests. Personally, I may take positions in a few of these portfolio companies over the next coming months. Even though I don't like the Works, it is looking VERY cheap now.

Here is a share price chart of DSM from trading view with a few averages (green 50 day, white 100, purple 200, dotted very long term).

https://www.tradingview.com/x/Z3klTkzz/

RBC starts Breedon with 'outperform' - price target 575 pence

Some weakness over forward energy prices from what I hear, though analysts expect the NAV discount to decrease this year. I am happy holding though my decent profit is now gone. Probably would consider buying Bluefield as well, has a slightly better broker rating.

Here is the recent interview from NESF

https://www.youtube.com/watch?v=S6K8vg88Rnk&ab_channel=QuotedData

I sold my Knights shares before and after the results, after a fantastic 30% rise over Christmas.

https://x.com/DartronTrading/status/1745407668406173818?s=20

I just felt that there wasn't anything left in the tank from a rally perspective. I bought another small cap, which is in the position that Knights was around a year ago. Well under half of its fair value, still recovering from a few recent issues. I think that is what attracted me to Knights, being able to buy as low as the 70's. with a 50% upside.

I note there was a lot more discussion on this board back at that time, have most sold out as well? I was prompted to post here today as I found this rating from Shore capital, which has a target price of 115p - and yes it was published after the latest results. TBH, I would like to buy these back, but Im not interested in paying above 115 for them after ExD. The Investors Chronical also rates these as a hold and has them on a PE of 11, which disagrees somewhat with Shore's PE of 5 even taking in to account the rise in SP. The shore article is a little contradictory expecting the shares to re rate, but the price is already above their fair value target. I can see the 115 target on the research portal of IC, so its not a typo. The median target here is 160. I have shares that have dropped on weak earnings with higher % targets than this after they have been down graded - AFM today for example, "Analyst Calum Battersby retained his ‘buy’ recommendation and target price of 420p on the consultancy group" that is a 25% upside target after a downgrade. All makes me thinks Knights is around fair value, and not much of an income play. (AFM is not my new small cap, im stuck in there over a year).

Shore Capital makes a strong case for resilient Knights Group Legal services company Knights Group (KGH) is trading on an ‘undemanding’ valuation and has scope to rerate, says Shore Capital. Analyst Jamie Murray retained his ‘buy’ recommendation and ‘fair value’ target price of 115p on the stock, which was trading at 121p on Friday. It reported ‘resilient’ first half 2024 results, which ‘highlighted that management is executing its renewed strategy to focus on organic growth’, Murray said. ‘The outlook is positive with non-cyclical legal activity showing resilience and recruitment initiatives increasing fee earner headcount,’ he explained. Although Knights is a ‘well-regarded law firm with as strong presence outside of London which enables it to win market share’, Murray said the shares trade on an ‘undemanding price/earnings target of 5x’. ‘We expect this to increase following these resilient results,’ he said. ‘If management continue to execute its new strategy focused on organic growth, we think it can rerate to a multiple more in-line with the sector.’

Investment Manager, is currently estimating that the Managed Wind-Down could be completed within 2 years. Further, the Board believes, in consultation with the Investment Manager, that within the first six months of 2024 up to, or exceeding, 50 per cent. of the Company’s NAV could be returned to Shareholders in cash (assuming current bids for certain of the Company’s investments complete by then) with more value remaining in the NAV of the residual portfolio to be realised through the process of complete wind-down.

on or around the end of the first quarter in 2024, 25 per cent. of Shareholders’ capital at NAV which, given the Company’s discount as at 31 January 2024 of 11.9 per cent., would be a 13.5 per cent. premium to the Current Share Price; a further 25 per cent. of Shareholders’ capital at above NAV by 30 June 2024, which on current discounts and NAV would represent a greater than 13.5 per cent. premium to the Current Share Price; and beyond 30 June 2024, a mid case scenario for the current market suggests a return above the current NAV and hence a significantly better than 13.5 per cent. premium to the Current Share Price. In order to keep up a timely rate of returns, the Board has constructed an incentive scheme for the Investment Manager

So basically DSM keep invested and hope things improve, which I suspect they will. I think the second return - when they say " Shareholders’ capital at above NAV by 30 June 2024" they must mean 25% of todays NAV? So the same payment as payment 1? This leaves them 50% of todays NAV to hopefully make some returns and get those manager incentives.

So assume about 15p payment twice within 6 months. Any thoughts?

They need a complete clear out, Wendy out as well.

Note CFO was not thanked, and appears to be leaving with immediate effect. Sounds like a disagreement to me.

The NAV has reduced over January from 31.2 to 30.67. (-1.69%) Not bad considering a few of the drops the portfolio saw over January. The 27% cash is close to about 17p per share. The FA. sale will help when this concludes, shares are about 10% under the offer price currently. Of the ones that dropped, SPEC should bounce. Not sure about WRKS or CAU. We also a large dividend to look forward to from HSP, which should be about £270k.

The sale of FA. has been delayed a little due to the buyer being foreign. This could be an issue.

Prior to the wind up, it was always stated that 50% of shares could be redeemed for NAV in May 2024. So this is probably why it is winding up. They realise that you would be silly no to, and this would leave the fund in a sticky spot going forward. Shame about SPEC, as DSM added to this recently. It dived 30% last 2 days, but has not affected the nav by much. Shame the top up was il timed- as a buy today would have worked well. It could even be DSM selling to cause the drop. Fluid power down a little today. (I made a DSM watch list on this site and in Trading view, so I can follow all of the stocks).

The trading update has no bearing on the dividend, which was cancelled over 4 months back in the interims. Even if they wanted to pay a dividend, the largest share holder is not in favour of it. The update is ok, but not great in my opinion. I would have liked to see net debt reduced by more than 2M over last 6 months. Not much to look forward to, according to the board. Lets just hope that this gets taken over within the next year, so investors can see some return. Blackrock are slowly closing short position so we may see some upside in the mean time.

SB, previously, the cash balance quoted did not include Russia. And from what he said in the last presentation, the Russian balance would be run down any way. I linked to the part where he said this, if your interested.

https://youtu.be/a50MXSRBi44?t=1262

Listening on a little further, if the above is correct then current cash has exceeded expectations of 2.4M EOY. My remaining investment in my pension looking for growth is happy with the situation. I would still like a top up under 30p if it comes.

I have bought in recently. I did some research at the time, and regarding the Works - The position was bought in May 2022 at 3%, then it was added to on January 2023 to go to 4.3%. The economic climate was very different in 2022. Yes the position could have been sold, but the remit of the fund is to stay invested in microcaps. By all accounts the Works is very cheap now, there are other II there who are pushing back on Dividends and asking for buy backs. At least the business is virtually debt free and has currently a fair bit of net cash. It appears cheap on fundamentals, but I dont like the business.

I have not followed the stock closely but it seems to have disappointed repeatedly after the buy in here. It looks from a cursory glance that a management shake up is needed, though you could argue that the business itself is not a great one (shops full of tat IMO, not great at anything). I wouldn't buy the stock myself, but we are where we are. Just putting the record straight that the decision was not made in 2023 to invest in the Works, if anything you could say it was back in 2022.

Having just bought in, it only matters to me if the NAV increases from now, so even if the Works cannot get back to b/e for this fund, I still think it will recover somewhat. The fund is a mixed bag in terms of success, but I still feel they can add value as they wind up the fund. They are selling in to strength on JNEO which is at an ATH, and selling down a few other positions. I noticed that they increased on SPEC. Of all the positions, assuming FA. sale goes through, and EQLS gets a bid, then we only need another big winner to make a material difference here. I like NWOR, be great to see an offer there after Media courage went up to 24% in December. You can only pick the stocks as an investor, manage your entries and exits. Nothing else is in your control.

100,000 Euros was stated in the last presentation (thats about £85k).

https://youtu.be/a50MXSRBi44?t=3245

Spike, the working capital loan is undrawn. That is about what they could raise from a placing. Next thing would be a CLN from Tyrus, to replace those 50p warrants. Doubt PI's get in at this level from any dilution.

I think a placing is out of the question, when the mcap is so low ($178M). Its not going to raise much cash, to make a lot of difference. Tyrus who sit on the board are not going to want this. I do think cash is tight, if you add up the costs in the RNS. Dont be fooled by the cash balance, which was only a snapshot on a particular day. Hopefully between them all, they can conduct some financial engineering - it seems to be in everybody's interests. I think operationally they seem stretched, so another acquisition also makes no sense. Joint broker is becoming very common on small caps. It does not necessarily mean a raise is coming. If anybody is interested I wrote a post about this subject on ticker REAT.

It was kind of announced...

Look in the going concern part of the last couple of FY results, it is mentioned. Though its not made obvious in the liabilities section. Best way is to Ctrl-F for HMRC. That is how i found it.

I was thinking that it might have been them selling at 2p on the day of the placing. However Chelverton have not sold any shares, I just checked after the previous placing they still had 9,000,000 shares. So the position is just reducing due to dilution. The position is worth £180k at 2p. Seems an odd use of their funds when the trust is a dividend trust. Perhaps the old adage of 'its only a loss if you sell' is in play here. I suspect they bought in the old days of 80p+ per share.

So of the 30,000,000 placing shares:

Miton 3.75M

Raglan 7.5M

First Equity 11M

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22.25M out of 31,350,000

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So there is 9.1M knocking about... (and possibly First equity bought another 1M).

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That isnt that many really. £182,000 worst case that could be flipped. Lets hope they all find homes. We may have even bought some unwittingly already. Ideally if there are no sellers down at this price then we might get back to 3p over the next few weeks.

I would say the interest rate news has caused the drop.

European stock markets drifted more decisively lower on Tuesday as hopes for a rate cut by the European Central Bank diminished following some hawkish comments from policymakers, whilst data confirmed German inflation rose in December. The Dax slipped about 0.7 per cent while the FTSE 100 fell 0.6 per cent. Several monetary policy hawks from the European Central Bank circled, and delivered a clear message in concert – this was no coincidence so the market is taking it seriously.

Joachim Nagel, president of the Deutsche Bundesbank, said it was “too early to talk about cuts” because “inflation is too high”, while his Austrian counterpart Robert Holzmann told CNBC: “I cannot imagine that we’ll talk about cuts yet because we should not talk about it. Everything we have seen in recent weeks points in the opposite direction, so I may even foresee no cut at all this year.”

Looks like Miton took 3,750,000 shares in the placing. Their holding slightly increased (due to dilution).

Jefferies cuts Moneysupermarket.com to 'hold' (buy) - price target 265 (305) pence