RE: share prophets TIPPED2 May 2017 13:57
Concepta (CPT) wants to know why its shares are nor racing away although having tipped this at an 11p offer we are, at 16.5p, well up.? Simple. It announced last autumn that it was about to sell its MyLotus kits in China and since then it has appointed a country manager and huffed and puffed but there are no sign of those sales. And against that background after calendar 2016 results the shares are just 16.5p mid. But before you sell hang on a second...the shares are actually a stonking buy if yoiu can get them at 16p or underand here is why.
The results contained no shocks. Sales nil. The company raised a net £3.4 million in July with the RTO and ended the year with net cash of £2.7 million and net current assets a tad higher despite investing in a new factory in the post industrial wastelands of Doncaster and in the infrastructure for China launch. So there is no cash crisis. But what about sales?
We are told that with EU approvals in MyLotus can be launched in the UK and throughout the Evil Empire in H2. Fine but what about China? That was going to be the first launch and Concepta says that in the PRC it has a manufacturing agreement signed with a leading Chinese manufacturer Shijiazhuang Huanzhong Biotech Limited to assemble and package myLotus.
myLotus is the only known home platform to offer both qualitative and quantitative results in the women's infertility space - the potential market is $600 million a year.
At 16.5p the company is capitalised at just £18.6 million. If sales come through in any volume then on a high gross margin the bottom line impact will be huge and the shares will utterly rocket.
So the question is what about China? When will we see the first sales. Our sources say that news is imminent, within weeks. That would see the shares roof it. So although tthe results statement is about as exciting as a rainy day in er....Doncaster the fireworks are not that far away. At up to 16p ( the shares were c15p when this article first appeared behind the paywall) BUY with a target to sell of 25p+
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