Mad Paws Holdings Limited

MPA Details

Shareholding Updates: Mad Paws Holdings Limited (ASX: MPA) provides online pet care services to its registered service providers (pet sitters, walkers, and groomers). In August 2020, MPA launched a pet food subscription product -Mad Paws Dinner Bowl to pet owners with packed pet meals. As of 31 March 2021, the market capitalisation of the company stood at ~$41.83 million. On 31 March 2021, MPA announced that its Director, Justus Tobias Hammer, who holds a direct interest in the company, has acquired 50,000 ordinary shares of the company at $0.20 per share. On 29 March 2021, MPA declared Bombora Investment Management Pty Limited (Bombora) as a substantial holder in the company with 13.98% voting power and 30 million shares. Prual Investments Pte Limited is also a key shareholder in MPA as disclosed in the prospectus release with a shareholding of 13.31 million shares (minimum 6.51% of share capital) held at the listing time.

MPA Listing on ASX: On 26 March 2021, MPA announced ASX’s listing via its $12 million IPO (oversubscribed) at $0.20 per share. It had a market capitalisation of $42.92 million at the time of listing. MPA had secured investments from Tim Fung-CEO and Founder of Airtasker, Qantas, and Bombora Special Investments Growth Fund before listing only. Funds from the IPO will aid organic growth, solidify MPA’s position in the Australian pet services marketplace, broaden the Mad Paws shareholder base and provide the required liquidity.

Business Update: MPA earned a revenue of $980k for 1HFY20 ending December 2020. The company has a registered user database of more than 600k and 22k pet service providers. It is experiencing robust trade conditions and revenue growth despite COVID-19 restrictions. It had a positive annualised Gross Merchandise Value (GMV) of $20.2 million in December 2020. MPA’s pet ownership has increased due to the demand for its offerings in COVID times. Given the increased demand for its services, MPA has introduced new verticals on a subscription-based model.

December 1HFY20, Highlights (Source: Company Reports)

Key Risks: The company faces the risk of being an early-stage firm, growth challenges to scale up and become profitable, seeking adequate capital from investors timely to meet short/long term objectives. It faces the risk of retaining old and gaining new users for its product portfolio.  

Outlook: MPA has collaborated with AI Insurance and Pacific Insurance to offer Mad-Paws branded pet insurance products in FY21 and planning for its sales and marketing activities. For FY21, MPA will continue to build new products & services for its pet owners and enhance their experience with their pets.

Stock Recommendation: Since listing, the stock has witnessed a fall of 29.82% from its opening price of $0.285. Considering aforesaid factors, limited trading history, and current trading levels, we can avoid the stock at the current market price of $0.200 (up by ~2.564% on 31 March 2021) by looking at the current volatility in the market and suggest investors to wait for more growth catalysts to get better entry levels.

MPA Daily Technical Chart (Source: Refinitiv, Thomson Reuters)

Kinora Copper Limited 

KCC Details

Listing on ASX: Kinora Copper Limited (ASX: KCC) is engaged in the exploration and mining of gold-copper in the Lachlan Fold Belt (“LFB”) of Australia. It has offices in Melbourne and Vancouver and operations in Trundle, New South Wales (NSW). As of 31 March 2021, the market capitalisation of the company stood at ~$17.71 million. On 26 March 2021, KCC was admitted to the official list of ASX Limited. KCC has raised funds from the ASX listing primarily for its drilling activities at its core projects. It has received conditional approval from TSX Venture as well for listing.

FY20 Results Declared: KCC reported a net loss of CAD 32.23 million for FY20. During FY20, KCC received CAD 45,000, a settlement of debt and CAD 2.02 million of general and administrative expenses. During FY20, KCC started and continued drilling on its flagship project – Trundle with the LFB. It announced positive gold and copper results and two rigs operational at present. In August 2020, KCC raised CAD 5.32 million proceeds from the issue of 17.76 million units at $0.30 per unit via a private placement. KCC held a cash balance of CAD 4.46 million as of 31 December 2020.

Quarterly Results’ Summary (Source: Company Reports)

Key Risks: The company faces the risk of early-stage exploration at its ongoing projects, the spread of COVID-19 among its staff and contractors, and operating with the pandemic protocols on travel, safety, and bear the risk of project delays as caused due to the crisis.   

Outlook: KCC plans to undertake exploration activities at Trundle, Fairholme and Nyngan (its main projects) in the short-medium term.

Stock Recommendation: Since its first trading day, the stock of KCC has witnessed fall of 14% from its opening price of $0.25. The stock of KCC has a support level of ~$0.212 and a resistance level of ~$0.218. Considering the ongoing exploration stage activities on projects, a recent listing on ASX, low market capitalisation, we give an ‘Avoid’ rating on the stock at the current market price of $0.215, down by 10.417% on 31 March 2021. We look forward to further catalyst to support the momentum in the stock price.

KCC Daily Technical Chart (Source: Refinitiv, Thomson Reuters)

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