RE: Chart20 Jun 2020 09:03
The company has said that it expects revenue to start coming late this year and through 2021, so I guess in about the next 12 months we will have a clearer idea of whether or not this will be a success and if so, assuming the tech is taken up, how quickly it is being used and from there, likely profits.
It seems the ducks are in a row, inasmuch the company would appear to have enough money to last 18 months or more, which until recently the last (oversubscribed share placement) had not been the case. Various board members have been introduced from other companies with experience in this industry and new tech, to promote the XSG presumably with a higher level of professionalism that had currently been the case. Joint deals with some of the largest washing manufacturers in the world are in place and a few (that I know of) large blue chip French companies have actually bought the machines with the tech in them. The tech itself, reducing water consumption, in both washing and manufacture, in this climate of heightened eco conservatism, along with the micro plastic filter, would seem to be perfectly timed with the current zeitgeist. There is of obvious benefit to companies that are water metered as that will allow them to use these machines and save money on their water consumption. The potential is so vast as to be in calculable. Domestic market (global), every restaurant that uses linen, every hotel, every hospital, clothing manufacturers. It almost seems too good to be true.
The downside is that this is a "Jam tomorrow" company and tomorrow seems like it never comes and it has taken a long time to get to here with huge sums of money expended with long term shareholders being absolute scorched on their investment. It has completely changed its business model from producing the machines to just an IP company to reduce costs, to buy time to financially stay in the game. As I say we should know by this time next year if this is going to fly or not but if it does there would seem to be fantastic potential.
But its all or nothing. Its difficult to trade because the spread is too large, you can't really time buying and selling because an RNS could come any day that would transform the SP (one way or the other). So you either commit or you don't but waiting is a high risk game now as the plane is on the runway, will it take next week or next year or ever? This is definitely one of those stocks that you are more likely to lose everything if it fails rather than just take a loss on some disappointing trade update of a typical larger cap trading stock.
Personally the tech , conservation of water seems, going forward, seems a no brainer. The partnerships already in place with the producers are very positive. The missing ingredient is the machine makers selling their machines with the XSG tech in them. As I said, the fact that large blue chip companies are doing so now, seems to me to lower the risk of failure by some margin.
But that's just my take
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