- $28mn of fair value portfolio gains in 2021 financial year
- Net asset value (NAV) doubles to a record $68.1mn
- NAV per share increases 37 per cent to 48¢ (39p) at 30 November 2021
Tekcapital (TEK:31.5p), an investment company focused on food technology, autonomous vehicles, smart eyewear and respiratory medical devices, has reported eye-catching annual results that justify including the shares, at 29.1p, in my 2022 Bargain Shares Portfolio.
The lion share ($18.8mn) of the $28mn (£23mn) investment gains reported came from Tekcapital’s valuable $22.7mn (13p a share) stake in respiratory medical device Aim-traded company Belluscura (BELL). Shares in that company have doubled in value since its IPO a year ago, a reflection of the ongoing operational outperformance and potential to deliver a rapid increase in sales and profits, as I noted in my original analysis.
The balance of the gains came from a $12.5mn uplift to $17.3mn (10p a share) on Tek’s 80 per cent holding in Lucyd, the first company to deliver prescription glasses with Bluetooth technology. However, this was is on a valuation of $3.56 per share in a crowdfunding round, a pre-money valuation of $20mn. Since then Lucyd’s wholly owned subsidiary Innovative Eyewear has filed to list its shares on Nasdaq at a pre-money valuation of $34mn to $46mn (pricing range of $5.50 to $7.50 per share), implying a potential further uplift of 5.5p to 11p a share in Tek’s holding of 4.9mn shares.
Furthermore, since Tek’s financial year-end, investee company Guident, a developer of remote monitoring and control software (RMCS) that improves the safety of autonomous vehicles (AV) and land-based delivery robots, has been selected by The Jacksonville State Authority in Florida as vendor to provide RMCS to the city’s urban circular project.
| Bargain Shares Portfolio 2022 | ||||||
| Company name | TIDM | Market | Opening offer price 11.02.22 | Latest bid price 9.05.22 | Dividends | Total return |
| Tavistock Investments | TAVI | Aim | 4p | 5.3p | 0p | 35.9% |
| Vector Capital | VCAP | Aim | 46.6p | 61p | 0p | 31.0% |
| H&T | HAT | Aim | 304p | 341p | 0p | 12.2% |
| Billington | BILN | Aim | 214p | 228p | 0p | 6.5% |
| Tekcapital | TEK | Aim | 29.15p | 31p | 0p | 6.3% |
| Henry Boot | BOOT | Main | 300p | 315p | 3.63p | 6.2% |
| Sylvania Platinum | SLP | Aim | 98.4p | 91p | 2.25p | -5.2% |
| Conygar | CIC | Aim | 160p | 143p | 0p | -10.6% |
| Average | 10.3% | |||||
| FTSE All-Share Total Return index | 8,525 | 8,054 | -5.5% | |||
| FTSE Aim All-Share Total Return index | 1,258 | 1,111 | -11.7% | |||
Source: London Stock Exchange
Guident is holding a private placement at a pre-money valuation of $18.1mn (10p a share), hence the valuation used in Tek’s accounts. This is based on the company delivering net profits of $41mn through to 2026 from teleoperation software sales. I can see valuation upside if the roll-out of Guident’s proprietary software gains momentum.
The bottom line is that Tek’s shares, at 31p, are priced well below proforma net asset value of 44.5p to 50p based on Innovative Eyeware’s IPO valuation range. Buy.
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