Member Info for Kooba

Some have said the turnover is less than $500k and i have seen similar from some filings but i believe the correct entity is

Shoei Chemical Inc. (昭栄化学工業) reported sales of ¥71.01 billion (approximately $450-500 million USD, depending on exchange rates) for the fiscal year ending March 2025, a solid performance for the Japanese chemical manufacturer known for products like copper powder for capacitors.

There seems to be concern with the available information on gleaning Shoei Chemical inc and Shoei Electronic Materials Inc ( US subsidiary) financial wherewithal , there are a number of Shoei entities and chemical although going for decades seems very small. However this looks to be the entity that has purchased Nanosys and has built a large state of the art manufacturing facility. Some clarity in terms of the financial strength on the owner of Nanosys would shed a better light on the motivation around litigation and whether they are a potential buyer of the business and its IP.

I would imagine the course of action in the states is the last thing you would do if you were engaged in acquisition talks.

So the market continues to undervalue the business using logic.

It now undervalues the company 43% more than at thr start of the year despite the fabulous progress made and the imminent commercial breakthroughs leading to cashflow breakeven in 2027.

The management continues to try to remind the market that there is great hidden value in the company but the market is dumb and ignores their pleas despite some directors buying shares a year ago at twice the price.

How can the market be so stupid for over 15 years and not correctly value the technology that is rapidly falling out of patent protection.

As it goes it appears the markets scepticism has been far more warranted than the optimism of the company and any AI BS for years.

Market participants are often better informed than the public releases that AI churn out when directed…unfortunately due to fear and greed share prices are not often that wrong and are proved right in time.Believing otherwise is not investment analysis it is nativity and ignorance in understanding markets efficiency.

Shoei co is a listed company , market cap over $500m. They bought the QD assets from the private Nanosys legal entity leaving that as a wind down shell for its shareholders IN 2023. So the name and all the operations are 100% owned by a fairly large listed concern. It is that company that is effectively challenging that they do not infringe on Nanoco IP.

My opinion would be that Shoei believe they have a strong case to embark on the legal course they have done and being dismissive and trying to belittle them is not sensible.

The market position right now might indicate that some see this new legal challenge as putting any sale in jeopardy but that may not be the case. Also the cash burn circa £400k a month and improved cash position at around £16m means they are in a position where they can defend the action and still have runway to achieve their target of cash flow breakeven in 2027 through supplying increased materials to Asian customer 1 ahead of commercial scale launch 2028. They are also still engaged in trying to sell the operations as guess at significantly higher level than the zero currently implied.

Much can go wrong as we know with this counter but the rating certainly is not factoring in anything going right at these levels.

I think they need to put a definitive end date on the strategic sale process.

If no one is prepared to put something up after a year then i would say they are wasting everyone’s time.

Impossible to know unless you have the terms of the settlement. Is it just for historic infringement? Is the settlement just since Shoei owned the Nanosys assets , any previous infringement rests with the probably now liquidate holding company .

Is there a future licence for LG products in there. Without such information it’s difficult to read much into the settlement however much you try and spin it.

Also begs the question if LG acknowledge the strength of Nanoco IP and this might drag on why they don’t seek to work with Nanoco to supply… even as a hedge. Are they really going to carry on using Nanosys products after settling with the prospect of continuing to knowingly be infringing ??

With a likely rapidly expanding market for CFQD materials i imagine there is room for more than one player. The competitive position that Nanoco claim has not led customers to their door for commercial scale CFQDs as of yet , whilst it is clear that commercial products aside from Samsung have been in the market.

The time it takes to develop and customise these materials i guess means they are far from commodity products and we have a number of major chemical material companies working with us which could lead to major commercial scale applications , i doubt the outcome of this legal move will change that.

Question is are Shoei doing this as a defensive move sensing that Nanoco are going to attack and trying to get on the front foot in a rocket docket setting to outmanoeuvre Nanoco or is this an aggressive move by them queeering the sale process and being undertaken from a position of confidence in establishing they are able to supply commercial scale CFQDs without infringing on out IP?

Ai

A declaratory judgment case in the Eastern District of Virginia (EDVA), a "rocket docket" court, can take approximately 20 to 25 weeks from filing to trial, though it can take longer. The timeline is faster than in many other districts because the EDVA has a streamlined case management process, with trial often scheduled just 4–8 weeks after the final pre-trial conference.

Well if they got the price attributed to the IP £47m take plus the £16m in the bank less £5m for fees and wind up of listed entity costs it could present cash of £58m take off a few £m in bonuses would sti;; leave £55m to distribute to shareholders or 28p per share.

With the process drawing to a close we understand , it seems impossible to think the market are so misjudging the possibility of such an outcome. There appears no pricing in at all of there being a meaningful value placed on the assets we are told are significantly undervalued by the market. It appears the company is being valued solely on the go it alone basis but even that is well down on where we were trading a year ago despite the progress with Asian customer 1 and the prospect of cash flow breakeven even 2027 and the possibility of mass market adoption in devices in 2028 and the LG win which again reenforces our IP and gives further balance sheet security to get to commercial sales.

Unfortunately with the track record of this counter and the ability to disappoint nothing is priced on potential. Strange thing is if you floated this company now as a fresh IPO with the estimates of growth in SwIr markets i could see it commanding a very large enterprise value.As it is and with the company apparently still engaged in takeover talks that could lead to a big short term flip …its all valued at nothing but the cash.

Well if it does it is not hampering Nanoco really….Nanosys have been supplying CFQDs to customers for years far more successfully than Nanoco . There would be no ruling against Nanoco it would just mean that Shoei/Nanosys continue competing in CFQDs…i think a clever bit of gaming , maybe they are aware that the sales process is drawing to a close and trying to throw a spanner in the works , but it would have been far more effective if they had reason to sue Nanoco which clearly they dont. If the market expands due to EU directive then there should be more opportunities ..but maybe Nanoco can no longer spin the mantra that only they can produce CFQDs in scale.

Clearly the market is not responding positively at the moment but rather unclear on recent newsflow why.

Difficult to know why ..clearly EU tightening the restriction on cadmium based products is good if you claim to be lead in Cadmium free ones.

With Shoei we are not going lose anything that was at all factored in.And one hopes that Nanoco has a good chance of preventing Shoei from establishing that they are not infringing. Does it muddy the waters , i guess.

But we have won a settlement from LG and that is put to bed , we have got an extension on Asian customer that should see us getting cashflow breakeven in 2027 ( i know, i know) and proper commercial scale orders into 2028 .the money in settlement means we have more cash in the bank than we envisage. We had £14m at year end we have burn of £1.6m since but net £3.5m coming in from LG. So effective current cash £16m against a market cap now of less than £17m.

So basically no enterprise value again despite these positive developments. In fact the organic prospects are stronger now i believe. One can only think the market are pricing in a no deal for the company..but at this level is there really any further downside on that eventuality. The shares are down 38% year to date and to a large extent have priced that in.

The company were looking to prove value significantly above the value placed on the operations and IP attributed by the market, we are now back to the market valuing those assets and the prospect of the Asian customer coming through at next to nothing.

Much still to prove but so far the market is unimpressed despite the theoretically better position.

In terms of anyone interested in the assets…they could of course just make an offer for the listed entity if the company find a low ball offer unappetising , there are no blocking stakes.

Ha ha ha …the irony!

And so far have not been proved wrong on anything you ignoramus…the company has everything the prove in terms of being undervalued and over a year from embarking on a strategy to prove that , the valuation is lower and the market remains unconvinced.

You have no ability to comprehend the situation are very easily pleased with little progress and remain totally irrelevant whatever id you use.

You are in a world of your own where you just make things up aren't you Terry…you have called everything g thing wrong for years and have no self awareness whatsoever …a complete plank who tries to make themselves relevant by just running others posts through AI which is also consistently wrong in context. Totally worthless individual.

Amazing spot Terry…an hour after i did find it and posted it…what use are you??

Another point ..competitor capitulation…how exactly. They manufacture CFQDs and actually sell them to customers and have for years and they contest they do not infringe on Nanoco patents and they are the ones praising the move how is there capitulation??

AI Overview

Behind the Scenes at the Nanosys Quantum Dot Factory in Silicon ...

Nanosys develops and manufactures cadmium-free quantum dots (CFQDs), also known as heavy-metal-free quantum dots, for displays and other applications. These dots, often based on indium phosphide (InP), are used to improve display brightness, color, and energy efficiency, and are an alternative to traditional quantum dots that contain cadmium. Nanosys's CFQDs comply with regulations like the EU's Restriction of Hazardous Substances (RoHS) directive.

On Nanoco website yesterday..bit of an update on SWIR lead free functionality

https://www.nanocotechnologies.com/improving-pb-free-device-performance-by-progress-in-inas-qds/

Interesting on Nanosys site from a few days ago

https://www.nanosys.com/blog-newsroom/europe-finally-ends-the-cadmium-qd-exemption

No secret Nanosys are in CFQDs

On the surface though this should be very good news for a company with validated IP in CFQDs.

Shoei are clearly trying to control the situation and pick the venue…

Might find this prompts Nanoco to litigate for infringement in East Texas.

Think Shoei are trying outmanoeuvre Nanoco and just hope they have the case and evidence ready to see this off and force a settlement. The situation may be complicated by the history of Nanosys ..historic infringement is tricky as Shoei just bought the assets but not the legal entity in 2023. But clearly they still fell vulnerable to litigation with their current activity.

Interesting , one must presume that Nanoco have been circling and Shoei want to get on the front foot before Nanoco issues infringement proceedings

“A non-infringement claim is a legal request or a defense asserting that a specific product, process, or action does not violate a patent, copyright, or other intellectual property right. It seeks a court or other authority to issue a binding determination that no infringement has occurred or would occur, often used to proactively address accusations or to clarify legal uncertainty and avoid costly litigation. “

That is true and I noted in the presentation…he seems a happy holder and is down 40% …he is of course getting paid but seems convinced value will out one way or the other.

The fact they are aiming for cash flow breakeven even in 2027 is significant in terms of what he knows around the Asian 1 work programme as they must be seeing a major jump in material sales as that programme moves into pre commercial scale up.

Unless there is a significant premium to current market value and they have cash burn under control ( plus the additional settlement funds) maybe they see bigger upside potential in going for the mass market adoption a few years out ?

I would trust Dmitry to take us to commercialisation stage …hopefully with more than just the one iron in the fire than the previous CEOs…he has nous and relevant experience.

i thought that they would drag it out ..indeed so were cavendish their corporate brokers that research the company , saying it was a surprise settlement and will be working on updating their research on the back of it.

probably a pragmatic move taking a small but meaningful settlement now rather than racking up legal fees for a likely but uncertain larger award further down the line. nb over 40% of the samsung settlement went on funding and fees ..and the award here was always going to be very modest compared to samsung.

an acceptable outcome in relatively quick timescale ..the lawyers must be ****ed!