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Thread: ikeGPS - IPO

  1. #31
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    Xirr,

    You based your original post on the proposition that some light should be shone on these little companies. I agree with you on that point. Hopefully the new NZXT market is a move in the right direction given the NZX has engaged Edison Investment Research to do quarterly reports on new entrants over their first three years in the market.

    In terms of IKE's prospects time will tell if you are right, the next half year update will reveal if they were telling porkies about their FY'15/'16 revenue, a full year should give a good steer on whether or not they are going to succeed over the longer term. While IKE may be a high risk start-up it has a number of characteristics which differentiate it from "packaging any old crap" start-ups.

    For the record Galvanized Group was formed in 2003, the name was changed to SurveyLab Group the same year and to IkeGPS Group in 2013, so it's been going for a bit over a decade. Jenny Morel's No8 Ventures invested $2m in 2005, a useful cash injection but wouldn't fund much development. It doesn't worry me they're over ten years old because until recently they were a tiny undercapitalised business and I'm sure like all of us they learnt by making mistakes. Even if the product is crap as you claim, in terms of the time it takes to develop and get new products to market it's hardly "old" crap.

    When you say It was licensed with another high profile company the inference is they previously failed to exploit a significant sales opportunity. I assume you're talking about CERL and not the current deal with GE. They did a patent licence deal with CERL for the military version, working with the US military made good sense to get their product off the ground, most start-ups would see it as golden opportunity. But I doubt a US army research lab was ever going to be an effective sales partner, plus being beholden to a single dominant customer is often counterproductive to getting a product with broad appeal to market, the product can easily end up too bespoke. In the end IKE will sink or swim by selling into the private sector.

  2. #32
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    Interesting posts Survfer - I tend to avoid tech stocks in growth phase as the cash flow statements always scare me. And a couple of listed tech stocks are scam material to fleece the gullible ( time will tell with these.....) - if this company truly has disruptive technology it could be successful - fingers crossed for them.

  3. #33
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    http://www.ruggedpcreview.com/3_hand...r_longbow.html

    http://www.gemapsight.com/mapsight-solution/device/

    As you can see - not a new product. it never cracked it then and unlikely to now. The FY16 projections are mad house material.

    Apologies if I'm being a bit rough on the company, but I just really don't like Ike as an investment at the market cap it floated at. It's a bad look for new Zealand's capital markets to continually overinflate the worth of small tech companies and their prospects.
    Last edited by Xirr; 21-06-2015 at 11:16 AM.

  4. #34
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    Rule 10.1 : https://nzx.com/files/static/cms-doc...disclosure.pdf

    From the market update on 30 April the share price stayed around 80c until financials were released on 29 May. Since that time, the share price has fallen around 25%.

    Did the company's announcement provide continuous disclosure?

    https://www.nzx.com/companies/IKE/announcements/263678

    Excerpt

    "Major FY16 sales announcement, FY15 update and FY16 outlook

    Highlights
    - Business on track to deliver growth opportunities
    - Sales momentum pushes into FY16 with ground breaking orders from OEM channel
    - FY15 revenue below PFI with timing of orders falling into the FY16 period
    - US interest in making strategic investment

    FY15 update and FY16 outlook
    ikeGPS, the remote measurement firm, said that it expected its FY15 revenue would be up more than two times on its previous year. The company’s Before Tax result would exceed forecast (PFI FY15 forecast Loss before Tax of $5.33m) although its revenue would come in below forecast (PFI FY15 forecast revenue of $6.46m) primarily due to anticipated sales from its start-up smartphone solution falling just outside the 31 March 2015 financial year end."



  5. #35
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    Xirr,

    We're absolutely on the same page about inadequate disclosure, which is one reason I got off my backside to post for the first time. However, most of these start-ups gild the lily in their IPOs and market updates and on balance I don't see IKE being nearly the worst on the disclosure front. They put out a half year update on 25 November 4 months after they listed, the half year revenue of $1.7m, which would include a chunk of interest from the IPO war chest, made it clear to a prudent investor they were going to struggle to reach the $4.5m revenue target in FY'15. Their FY'15 financial reporting is reasonably comprehensive including a good breakdown of the differences between their FY'15 actuals and the prospectus forecast, even if it is hidden at the back.

    I agree with you their FY'16 revenue forecast of $14.3m is an extreme stretch but disagree that the downward trend in the share price started after the FY'15 unaudited accounts were released. It started after the half year update was released when the share price was hovering between $0.90 and $1.00, by the time they disclosed the FY'15 financial result on 30 April the share price was around $0.80 and since then it has fallen into the $0.60's, the 50 day average trend looks reasonably consistent from when the half year update came out.

    Looking back at their prospectus I can't see anywhere where they disclosed what happened with the Juniper partnership, it seems they started shipping the Archer Longbow version of MapSight in August 2011 and the partnership ended in early January 2012 after 5 months, so there must have been a serious falling out. While it may be legacy water under the bridge, and I doubt GE would let their brand be associated with IKE unless they were confident GE MapSight has a few legs, it isn't a good look they didn't disclose what happened. The Longbow looks like it was a hybrid of IKE's Mapsight and Juniper's Archer GPS device which doesn't feel like a cost effective solution given how easy it is to on board your own GPS functionality. Given your view on IKE's products I assume you know the history, I would be interested in hearing what caused the parting of the ways.

    The way I look at IKE is their products serve a need in a niche market as well as being appealing to a range of potential customers in the niche. They have a modest but growing revenue and around 3 years of cash at the current burn rate, plus the falling NZD/USD cross rate is helping. Assuming they can get their annual revenue to a sustainable $15 to $20m over the next four to five years and keep their costs under control they are probably worth a punt, particularly if the share price falls further. On expense side looking at where the HQ is located and the salaries they are paying their senior management I don't get the sense they are overly spendthrift, but if they needed to cut their overhead costs there's room do so.

    Back to the disclosure issue. When looking at the recent crop of IPOs arguably the worst in terms of disclosure is Geoop, I mentioned this in my first post. Given their chair is the former NZX CEO they might reasonably be expected to be squeaky clean in terms of disclosure. They recently informed the market "the company remains on track with original disclosure" which is far from the truth. I'm thinking about posting my views on this to the GEO thread and if I do would be interested in your thoughts on which out of IKE and GEO is the worst in terms of disclosure.

  6. #36
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    I see the NZVIF have just taken a stake - funder of last resort?

  7. #37
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    Quote Originally Posted by kiwidollabill View Post
    I see the NZVIF have just taken a stake - funder of last resort?
    they held it indirectly via no 8. Now it's out of lock up, they have taken direct ownership. They are still in the money (just( as they invested early but they would struggle to sell off that large a parcel in its current state.

    More deets here (NBR unlocked): http://www.nbr.co.nz/article/nzvif-t...hares-b-175890
    Last edited by Harvey Specter; 22-07-2015 at 07:59 AM.

  8. #38
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    Trading halt today.

    Seeking to use a small overseas purchase interest (0.5 M) to justify a new share issue @81c to include other investors. Bit early perhaps, they should still have heaps OF $$$$$ left from the IPO.

    Par for the course .... your thoughts?

    DISC not holding.

  9. #39
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    New Aussie money at 60 cents and SPP coming and an ASX listing soon could make this a decent short term punt

    Punting being the word of course
    “Just consider that maybe the probability of you being wrong is higher than you think.”

  10. #40
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    IKE was recently brought to my attention by someone whose record is second to none.!!
    The 22nd of July presentation made excellent ready.
    I greatly respect The Chairman,Rick Christie.He led Rangatira well as CEO, and his time at Ebos was very profitable for me.
    I brought a small holding on 28th July at 70cents ps.The company will be a lot stronger with the capital raise,so I look forward to taking part in the SPP.

  11. #41
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    Question What would none recommend

    Quote Originally Posted by percy View Post
    IKE was recently brought to my attention by someone whose record is second to none.!!
    The 22nd of July presentation made excellent ready.
    I greatly respect The Chairman,Rick Christie.He led Rangatira well as CEO, and his time at Ebos was very profitable for me.
    I brought a small holding on 28th July at 70cents ps.The company will be a lot stronger with the capital raise,so I look forward to taking part in the SPP.
    Presentation slide 33 being titled "FY17 outlook: Well positioned" is as good a reason to buy as any other I suppose.

    Best Wishes
    Paper Tiger
    om mani peme hum

  12. #42
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    Quote Originally Posted by Paper Tiger View Post
    Presentation slide 33 being titled "FY17 outlook: Well positioned" is as good a reason to buy as any other I suppose.

    Best Wishes
    Paper Tiger
    Yes,I totally agree with you....lol.

  13. #43
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    Share price rising on solid volume.
    "well positioned"....????

  14. #44
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    Nice market update today.....sales looking good, some key inroads to the USA market, New products and services underway, cash position improving. Ticks a lot of boxes for me.

    Read it here.

    Disc; small holding and happy. TA looks good, Golden Cross in place.
    Last edited by Left field; 10-04-2018 at 09:11 AM.

  15. #45
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    Long term investors will be pleased to see the share price rise further on volume,478,802 shares traded at 57 cents,then sales at 58 cents.
    I guess IKE is starting to attract momentum traders/investors.

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