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Tekcapital (LSE:TEK) the university IP commerzalisation company, recently reported interim to the end of May. For the record a profit of $1.5m was made on unrealised gains from the revaluation of its portfolio, while the revenue from providing services increased by 157% to $635k. Most importantly the business has continued to develop, but yet the shares remain weak.
The cornerstone of Tek’s proposition is its proprietary discovery search engine linked to 4,000 plus universities in 160 countries. This is coupled with an expert scientific review board providing services for clients to find and acquire the IP they need to create a competitive advantage. This network can also provide out-licensing firms IP that can be directly commercialised.
Belluscura Ltd, was set-up by Tekcapital to commercialise and sell proprietary medical devices. It has acquired five products all of which could soon start to produce revenue and it also has licenses for the IP on 25 medical devices. The intention is to list on the stock market and it recently raised $1.7m pre-ipo at a value of $7.6m; Tek now owns 48%.
In January 2017, $3m was raised at 35p a share, shareholders include Nigel Wray with 17%, Legal& General 6.7% and the Directors own 21%. There are currently five major initiatives underway including a salt replacement additive, a food preparation technology that can reduce the fat content by c. 60%. Tek have 13 Augmented Reality patents for AR glasses which look like regular glasses but with see-through displays and eye tracking. This sector is estimated to be worth $83bn bu 2021 and the product development is be accelerated by rising upto $10m in AIM’s first issue of a crypto-currency. This crypto currency placing seems to have gone unnoticed and could add significant value to both Tek and the glasses. The prototype development is underway for an in-shoe -energy harvesting device to recharge mobile devices. These technology rights have been acquired for either cash or equity in Tekcapital and present significant up-side potential if /when successfully commercialised.
Financials
The interim net cash was $3.2m with a NAV of $7.9m.
Trading Strategy
After some delays there could be significant upside.
Tekcapital (LSE: TEK)
21.5p (20/23p)
Mkt Cap: £9.2m
Next Results: Year /End October
Last OMG! Price 44p
