By Tom Winnifrith | Tuesday 27 September 2016
Disclosure: Financial Investigative Media Limited, which is not owned by Tom Winnifrith but by a trust for his dependants, owns shares in companies mentioned in this article. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Concepta (CPT) has announced that it has signed a deal with a Chinese company, Huanzhong Biotech Limited ( HZ) to to assemble and package Concepta's 'My Lotus' fertility product. My Lotus already has regulatory clearance and so this paves the way for a launch very soon indeed.
HZ Biotech will exclusively assemble and package Concepta produced components (including bulk tests and electronic meters), to produce Concepta's My Lotus product to specification for the Chinese market. HZ will utilise its manufacturing site and processes, adhering to locally applicable laws and Chinese regulatory requirements.
In addition to assembling the final My Lotus product, HZ Biotech will be the sole purchaser of Concepta's My Lotus product and help facilitate its launch to the Chinese market and include post-market surveillance. Concepta will also look to work with a network of distributors in China to help achieve maximum market penetration in China and will update the market on these developments in due course.
Concepta's MyLotus is the only consumer product which allows both quantitative and qualitative measurements of a woman's personal hCG and LH hormone levels in an easy to use home test to facilitate higher conception rates and early diagnosis of any fertility problems.
Concepta states that an estimated 4 million women in China each year discover that they have unexplained infertility and that as such annual revenue potential for this target market is "expected to be worth" £250m per annum. Hmmmm, poor English. We think that means that the market potential is £250 million per annum.
But if My Lotus is as good as Concepta claims then it does not need much of a market share to justify a big premium to the current share price - at 18p the market cap is not a lot over £18 million.
And that is just China where we gather first sales will be made within days. 2016 will see a launch in the PRC. In 2017 we will see launches in the UK and Europe.
We expect more news on all fronts well before Christmas. You can see the potential and you can see that it is far from discounted. We are well up on the share tip (a 14p offer on this website) but on this news the stance is, at worst, a very strong hold. We continue to target 28p + to sell and to target that for before Christmas.
This article first appeared on the Nifty Fifty website which Lucian Miers runs with Tom Winnifrith & Steve Moore. To access the website ahead of the next share tip from Tom & Steve and ahead of a new shorting idea from Lucian GO HERE
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