Perspective7 Jul 2018 01:23
This is my take on KOOVS.
Feel free to cut n paste on the BB on a regular basis to ward of the doom mongers. If any part of my train of thought is misleading or inaccurate, please correct me.
Here goes:
KOOVS is now a very different company, with many parts of the jigsaw rapidly falling into place.
Exactly three months ago the SP was 6.35p - priced to fail amid grave concerns about funding, and sentiment extremely low.
There remained a small possibility that Lord Ali would secure some sort of deal to rescue the company. I remember thinking – blimey that’s cheap – I ought to buy some but unfortunately didn’t have any liquid funds at the time!
Since then some amazing developments have taken place in quick succession:
1) 26 April - Lord Ali injects £1.5m of his own capital into the business to 'keep the lights on' and effectively buys more time to find a £50m rescue funding deal.
2) 18 June - Koovs announced a £24m staged funding deal with Hindustan Times Media, the third largest media and publishing house in India
3) Then in the past week, the multi billionaire retail guru, Kishore Biyani's FLFL with 2,000 stores across India takes a 29.9% stake in Koovs, thereby opening up the entire Indian fashion retail market to KOOVS, almost entirely derisking the company going forward.
4) Additionally KOOVS raised £10.5m equity from a ‘restricted’ placing at 15p plus a further £1.5m from Lord Ali. This equity raise closed early as was RNSed today, with the BOD buying in too.
The above events cannot be underestimated. KOOVS is now backed by two heavyweights in the Indian retail and media space, fully cashed up, and can aggressively focus on pursuing online sales in a country with a 1.5bn strong population.
Derampers may point to the fact that 29.9% has been given away for 10p, therefore the company should be worth that much. This is a very narrow minded perspective of the situation as it stands for several reasons not least because the 10p ‘placing’ of additional shares is not a placing as such. It went to an insti/company partner, and was intended to secure a much greater catalyst and partnership for future growth not dissimilar to a Dragons Den scenario, in which inventors give away more equity than is necessary with the foresight, knowledge and confidence that the DRAGONS have the power, sway, influence and commercial muscle to accelerate growth much more rapidly than they ever could on their own.
We all know about the ASOS success story, and have heard from people 15 years ago who may have held when it was in the pence only to sell out far too soon.
Share price of ASOS in Aug 2003 was 3p per share
15 years later - In March 2018 it was £75 per share
That’s a rise 232,000% !!!
Your £1,000 investment in 2003, would be worth £2.32m now.
Can KOOVS enjoy similar success to ASOS?
You know what?
It just might.
Good luck in whatever you decide to do.
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