Ip Share Discussion Threads

[brucie5] 25/1/2020 09:05

Well said, Pierre.
C-capture does look interesting.

[guildedge] 24/1/2020 19:31

@ Pierre.

When I made those comments regards to IPO not making their valuation of 1.1bn 1-2 months back when Woodford was selling I was right. You only have to look at the Woodford mess to see how he was forced to sell shares well below their market rates. My comments this week were in regards to that.

The difference with CWR is the company is actually doing well. Which in turn has had a decent positive effect on the IPO share price due to market demand. Where if you look at some of IP Group other smaller investments they have crumbled and IP Group would only get a fraction of it's investment back. Remember IP Group used to be valued at 3 times the current Share price. Even before the merger.

Now with cash, Oxford Nanopore and CWR you can see this makes up a large chunk of IPO value. Before CWR, IP Group had not really shown a company that was actually giving a huge return on investement.

The company if now worth 1.3bn is still only valued at 60% of it's portfolio value. Invesco is likely holding this up. I do think there is strong demand for the shares here. It is a gradual story with 2020 designed to show the recovery. The market is discounting IP Group at circa 40%. I think Invesco will be patient in selling here. Why sell when people might pay 80p for a share.


My valuations for 2019 were based on my previous following of all it's public companies we can follow. Some of these are marginally higher. Others almost worthless.

I have actually been more positive on this share lately. We always knew one of the things holding back IP Group was it's 2 main shareholders. One has now sold out the other almost reduced by 50%.

I don't think I ever claimed to be invested here. It is a share I find interesting.

[bamboo2] 24/1/2020 16:57

Pierre, sorry to hear you're not into charts.

Re 36 '...resistance holding back the price is simply investec forced selling to satisfy those cashing in their investec funds...'

Invesco is our seller, rather than Investec. Easy mistake to make, and I'm pretty certain you already know this!

Interesting to see MWG bailed out by bank of Mum and Dad.
I guess this will give some hope to those holding TRX and XSG shares, as all of these SP's are currently in the doodoo!

[my retirement fund] 24/1/2020 13:02

This is looking strong but we do need a bloody good run up to break 80p. Should that happen its got to be a long term skywards journey for all imo.

[brucie5] 24/1/2020 11:51

Pierre Oreilly
24 Jan '20 - 09:37 - 36 of 36
0 0 0
Bamboo, I don't put any faith at all in charting...
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'He who lives by crystal balls should prepare to eat broken glass..." as Stocko has taken to repeating in its new format.

But actually, with IPO, the reverse is true, imho. There is so little transparency regarding the underlying value that the best thing we can measure is the share price, taken alongside what we know of the investment environment.

WIM selling; and a flight away from the kinds of tech that IPO owns, despite the sweetspot in which may of them operate, ie, ESG priority areas, to which funds will increasingly be directed.

Look at the 5 year chart. You are rarely given these kinds of opportunities, because mostly, they come in cycles, and you have to wait for them. For those with the patience, this could be that moment.

[pierre oreilly] 24/1/2020 09:37

Bamboo, I don't put any faith at all in charting, but each to their own. My view of any resistance holding back the price is simply investec forced selling to satisfy those cashing in their investec funds. When that selling stops, I'd expect the price to return to 80/90% nav. Their selling could stop today, or could stop only when they've sold the lot, which at the current rate will be a couple of weeks.

[pierre oreilly] 24/1/2020 09:31

Cwr up another 4%. Iirc, that's another £3m to ipo in one hour.I think cwr is ipo's second largest holding, but not certain. It's certainly one of ipo's big holdings.

[bamboo2] 24/1/2020 09:03

Thanks Brucie.

Some good volume pushing the price up. We still have our overhead resistance zone to get through. It's marked by the prior gap down [77.3-77.7 dated 6/6/19 - caused by Woodford's careless selling]

Udated significant shareholders.

[brucie5] 24/1/2020 08:53

Breaching again. Once it gets past 75, this could have some energy.

[pierre oreilly] 23/1/2020 17:43

Guild, I must say, I don't think ipo fits in with your investment views. On the one hand, yesterday you complained when ipo converted cwr shares into cash, and yet today you complain that the company is only worth half its holdings because they can't be converted into cash!.

Then you say it only takes 1 or 2 of its holdings for it to 'turn a corner' and yet its two biggest holdings by value are romping away. Not only are 1 or 2 'taking off', it's their 2 largest holding which are!

As to not expecting a huge rise (in asset value i assume?)for 2019 - well maybe not huge, but the company has already said a few of its holdings have for various reasons been revised upwards from the previous valuation.

You also didn't seem to realise the increase in asset value and increase in cash from the ceres situation, where ipo made about £10m in one day, and has made £50m in a few weeks, plus put more than 20 million quid in their bank account. How could you miss that major development?

The nature of the company, afaiia, is investing in new and seed companies with potential, usually from prestigious university research, supplying them with capital, and taking cash out at any future cash raising, if applicable, in the future years, while still keeping a shareholding, and then investing the cash further down the pipeline to rinse and repeat.

If you don't see the benefits here, or think this should trade at only 50% of its assets, then surely you should just sell up and invest where you see more promise?

[guildedge] 23/1/2020 17:03

My view was it stays at 700m value as they may never get the full value if the sold up fully today.

20-30m admin seems a huge amount given they are acting like a fund. They don't generate any actual revenue themselves.

As most have said her it takes 1-2 firms to break through in terms of value and then this could turn a corner. The results will value the shares at the end of the year. So 2020 added value won't be shown till H1.

I am not expecting a huge rise for 2019. I think the share price fell because of the sell off by Woodford and because everyone questioned IP Group valuations. Tainted by the Brush of another.

Invesco reduced again. Below 17% now. So 12% of their holding gone and I think a buyer has already been found for the rest otherwise the share would be falling heavily.

[dexdringle] 23/1/2020 12:28

I'm new in this one too. Bought at 74p a couple of weeks ago as it looked like it was starting to re-rate.

Didn't do a lot of research as was only investing just over £5k (7,000) shares on a bit of a whim really. Beginning to think I need to stop doing that !

[pierre oreilly] 23/1/2020 11:13

It says that there have been forced sellers. i.e. sellers who had no option but to sell, like those now administering woodfords remnants, and invesco managers who are facing big fund withdrawals.

That's what's throwing up the technical opportunity here.

And further to that, researching their holdings imv shows a coming revaluation upwards by at least 100m, together with at least 200m cash holdings. Which is a more fundamentsl second opportunity.

[dexdringle] 23/1/2020 11:09

Pierre Oreilly said: "The salient point here is the company is capped at about £730m yet it holds investments which will be valued around £1.2/1.3bn"

What does it say about the company / management, or confidence in the valuations, that the market cap is only 60% of the value of the underlying assets?

[brucie5] 23/1/2020 10:12

Dex, yes, it's a lot of money for this underperformance, but on the other hand, it should allow them to attract very high calibre staff. I prefer to dwell on the latter, as I think that the recent doldrums in the share price have been largely caused by factors that they can now learn from and avoid in future.

Some of the tech here look tentative, others like CWR and NANO, clearly less so. But it will only take a few winners for the share price to benefit. So long as they manage to hold on and not sell out too soon!

I like the chart and have doubled up this morning. I'm certainly looking for a break over £1 this year.

[pierre oreilly] 23/1/2020 09:24

Well if you don't like the salary situation, you're free to look for a financial investment where the average salaries of the managers are £20k or whatever. Two choices, like it or lump it.

I think city salaries and bonuses are obscene. But you pay them whether you invest wholesales (i.e. in quoted companies like ipo) or pay for many more managers on those salaries when you invest retail (like pensions etc).

Invest in a pension and the city will take about the same as your final pension pot they hand to you. Much less charges paid for direct investments.

[dexdringle] 23/1/2020 09:00

No, it was genuine.

Have just looked at the 2018 accounts. States that they employed an 'average' of 167 people in the year and salaries were £21.3M. Average annual salary (AVERAGE) is therefore £125,000.

Good job they are doing such a good job of creating shareholder value - and haven't presided over, say, a 66% drop in the share price over the last 4 years - otherwise by taking such salaries they could be deemed to have been taking the mickey…..

[pierre oreilly] 23/1/2020 08:54

The salient point here is the company is capped at about £730m yet it holds investments which will be valued around £1.2/1.3bn, including a couple of hundred million in cash, and its 2 biggest holdings are either rising rapidly in price or expected to be revalued much higher in the near future. Talk about a gift horse. The reason for the share price fall over the previous weeks is the technical situation brought about by woodford forced sales and now invesco forced sales, which will hopefully end soon. We may hav to wait a week or two or 3, but atm theres a bogof offer here which, in time, will correct itself.

[pierre oreilly] 23/1/2020 08:43

That's not the sort of information bb posters have access to ... or was it rhetorical for some reason?

I'm sure if you emailed the company they'd explain about their admin costs, and whether they are high or normal for such a company. Please post the answer here when you get one.

[dexdringle] 23/1/2020 08:06

IP Group employs only 87 people but manages to spend £34M per annum on admin ?

On what are they spending £34M ?

[pierre oreilly] 22/1/2020 23:44

18

Guild,

The value of ipo's cwr holding after the £23m sales was 75m at a price of 347p. Today the price rose to 392p, making ipo's holding now worth about £85m as i posted. Tbc, this is after the £23m sale.

'Dilution' doesn't really enter into the it- that just tells you the percentage of cwr ipo own.

How well did they do out of this share issue? .... well they gained about £10m overall in a couple of days and in addition converted £23m of shares into cash.

[bamboo2] 22/1/2020 22:57

Guildedge, When there is a willing buyer, I favour a gradual sale of investments as the value increases.

In the past IPGroup have relied on shareholders when they needed cash. This has to change, as the days of easy money from Woodford and Invesco are behind us now. We need to see the company generating genuine returns for re-investment.

Parkwalk have a very active policy of realising profit from portfolio co's when appropriate and it is good to see IPO also taking this path.

[guildedge] 22/1/2020 22:24

From the earlier RNS.
'As part of the transaction, IP Group has generated £22.4 million through the partial sale of its holding in Ceres Power. Based on the closing price of Ceres Power of 347 pence per share yesterday, the balance of IP Group's holding is valued at £75.3 million. This represents a realised and unrealised fair value gain of £23.1 million for the year to date.'

'Following the sale, IP Group holds an undiluted beneficial stake of 14.1% in Ceres. Following the issue of new shares, and assuming that Weichai Power, Ceres' largest strategic shareholder, exercises its anti-dilution rights at this time, the Group's resultant shareholding in Ceres will be approximately 12.8%'.

Not sure how well they did out of this share issue. They had 18.8%. They sold for £22m. Now group suggests value at £75.3m. I assume this is before dilution.

Whatever happens 22m is a good profit. Of course if they keep selling stakes in companies surging ahead they won't reap the full reward later. Assuming Ceres stays at £4. Will others take profit or is this the start of a bigger surge?