Creso Pharma Ltd (ASX: CPH)

Switzerland sets Creso’s step-change global commercialization strategy: Creso Pharma’s stock initially surged up 2.9% on December 04, 2017 before falling 2% while the group, which is a uniquely positioned nutraceutical and medical cannabis company in an anticipated US$ 385 billion industry, announced for obtaining the necessary approvals to market its hemp based nutraceutical cannaQIX®10 in Switzerland as a Food Supplement compliant with Swiss Federal food law. Further, Creso inked an exclusive commercialization agreement with Doetsch Grether (largest pharma/ OTC & consumer care company in Switzerland) to market and launch Creso’s cannaQIX®10 product in Switzerland through Doetsch Grether’s distribution channels for 10 years. Thus, the group has been able to trigger its strategic global commercialization using Switzerland as a reference country, paving path for other global launches. Along with this, the group has appointed a new finance director.
 

cannaQIX®10 (Source: Company Reports)
 
CPH stock has been trading on volatility and was up 88% in last one month, while witnessing a plunge of almost 19% in last five days (as at December 01, 2017). While the group aims to have a better financial performance, the strategic moves are tracking well. Lately, Creso secured a major deal for the Australian import of its first cannabinoid-based human health product, cannaQIX®50, in early CY2018. The group also signed a Binding Letter of Intent with LGC Capital Ltd and Baltic Beer Company Ltd to develop and market a bespoke portfolio of cannabis- and hemp-derived alcoholic and non-alcoholic beverages. We give a “Hold” on the stock at the current price of $0.995
 

Monash IVF Group Ltd (ASX: MVF)

Competition weighing on the stock: Monash IVF Group’s stock has slumped 31% in last six months (as at December 01, 2017). At its AGM, the group highlighted that MVF has continued to focus on developing industry leading science and technology in the assisted reproductive services and broader women’s health sector to have strong prospects of patients delivering a healthy baby. The groups’ FY17 earnings have risen despite a fall in patient treatments and associated revenues. Further, the Australian IVF market share slipped only marginally in FY17 after finding support from the strength and resilience of premium offering while total Australian Stimulated Cycles slipped by 0.2% in FY17 as compared to FY16 growth of 6.8%. However, weakness in financial performance to date and exit of one of the key doctors are unlikely to support any momentum for some time and can impact future results. The group expects a 20% drop in its 1H18 NPAT against previous corresponding period, at the back of factors including decline in Australian stimulated cycles market share by 2.5% in 1Q FY18 with increased competition and one-off expenditure on legal costs and CEO recruitment, amongst others. Mr David Morris has been said to be joining as the new CEO and MD of MVF. The directors of the group have been lately seen to acquire ordinary shares in the group. We are a bit sceptical on the short-term and medium-term movement given fluctuations in the IVF market, and recommend a “Hold” at the current price of $1.23, with a critical watchful approach.

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