Innovaderma a tale of Jekyll and Hyde, but who is winning now?

29th Jan by serko

3 comments 313 reads

Innovaderama (IDP) has had a bit of a Jekyll and Hyde performance since listing on the LSE in September 2016 at 70p a share. It had a rapid rise with a high of just over £4 in July 2017.

There were various reasons for this spike. Some to do with a great business performance, others by news releases being hyped up by investors. Below are some of the key announcements that led to this rise.

10^th October 2016: Trading statement announces an 800% rise in turnover and an expected maiden profit.
24^th October 2016: Announcement production would be moved to UK and would contribute to a positive financial performance.
31^St October 2016: Announced the launch of Skinny tan in the USA market with various “initially small” retail deals and the appointment of a USA based Executive Vice President.
31^st October 2016: As well as the USA announcement IDP also released its results, conforming profits of AUD0.47million
14^th December 2016: Placing of shares at 110p to raise £800,000 as strong demand for Skinny Tan means they need to increase production
16^th January 2017: Trading statement shows 80% increase in first half turnover.
30^th January 2017: Kieran Callan appointed as non-executive Director.
27^th February 2017: Acquisition of Stevie K and Charles and Lee Brands for AUD50,000
3^rd April 2017: Trading statement reports strong trading and signing of deals with Feelunique and Lookfantastic for Skinny Tan. Launch of Skinny Tan Professional range. Announced Charles and Lee would launch on its Direct to Consumer (DTC) platform in Australia in April and roll out the products internationally towards the end of this year and next. Announced Stevie K product range has been extended and would launch on DTC in July 2017 in UK and Australia and other international markets in the following quarter.
2^nd of May 2017: Acquisition of Prolong the only FDA approved device to help men with premature ejaculation issues.
3^rd of May 2017: Announced ASOS as a new etailer confirmed April was its highest grossing month ever.
22^nd of May 2017: Announced launch of new haircare brand to aid hair regrowth (we now know it as Roots Double Effect (Roots)) in 400 Superdrug stores. Launch of Body Glow skincare range in 500 Superdrug stores.
1^st of June 2017: Confirmed a deal with Boots in Ireland for Skinny Tan. This was seen as good news as it opens the door to…

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Redtop

29th Jan

Many thanks Serko for such a comprehensive run through. It does indeed look like an undervalued stock

muzmano

30th Jan

Yes, thanks for the work you put into that. From memory, Haris Chaudry dumped his shares in May 2018 after using an RNS reach to announce prolong had achieved FDA approval. As you point out he sold more immediately after the next trading update. I think that left a bad taste for investors. Certainly small company share watch stopped following it then and they helped build up the initial excitement.

shiftingshares.com

This is a great piece of writing serko - balanced and informative. Thank you very much.

I also hold shares in Innovaderma - I see the big risk as they don't meet their numbers, but this risk is negated by the low PE multiple. Big expectations just aren't factored in.

It's best that Haris Chaudry has left the company.

He managed to sell 4 million shares in a market that didn't appear to have the volume to take it - and 48 hours earlier a video was released of him promoting the company on Proactive Investors.

So he could only have placed the order:

Two days after the video had been released
Straight after the video had been released (market abuse)

Either way, it is clear that Haris Chaudry used shareholder cash to facilitate liquidity and achieve a better sell price for his share sale. That’s a fact.

Anyway, he's gone now. So hopefully onwards and upwards. We shall see.

Innovaderma a tale of Jekyll and Hyde, but who is winning now?

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Serko

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