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BUB - BUBS Australia

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BUBS Australia Limited (BUB) was formerly known as Hillcrest Litigation Services Limited (HLS).

BUBS Australia is engaged in the business of production and sale of infant milk formula and organic infant food in the infant food category.

Based in Sydney, BUBS has partnered with leading manufacturers and a team of industry
experts to continually innovate and launch infant food products that sit side by side with established multinational brands.

http://www.bubsaustralia.com
 
Anyone else following this back-door listing? Popped 32% today but had a little spike a few days back to 21.5c.

Sells goats milk infant formula. Current price move is on the back of a recent NetEase Kaola. I've also had a squiz at 10cents and JD.com and Bubs products is all on there. This included a number of 5-star ratings.

Very early days for this & no revenue. Funny little start-up as well & limited financial history. But kicking come goals with these Chinese retail web-sites. Murky stuff but so was Bellamy's & that ran to the moon & back.

One for the watch-list anyway - DYOR
 
Reactions: skc

Yes very interesting stuff... I have never imagined feeding my babies goat milk but that is probably just my ignorant. A2 was able to establish itself as different/better/premium without hard scientific facts (again, from my limited understanding) so who's to say goat milk wouldn't get the hype.

Just can't help but think that goat milk is a bigger barrier than A2 protein or organic formula based on the trusted cows.
 
As an anecdote, here in Spain there is quite a bit of goat milk product on the shelf. In the form of milk, yogurt, kefir etc.
In Australia I only ever noticed it in health food stores, but over here it is fairly standard at the big supermarkets.

Supposedly goats milk is closer in structure to human milk and therefore is better tolerated by many people.
 
Tech/A , can you go through your thinking, bar by bar on

" Chart looks interesting with a
pullback in play. "

Well done 20% gain on day 1 of July trading is impressive.

gg
 
Karlo
Check out " charts of interest " your 3 days too late
It's also in a trading halt.

You can't trade smalls with past history analysis.
 
Saw you chose BUB for this coming months September Stock Picking Competition, so I decided to have a quick glance at chart and comment.

Yes, have now viewed your own "Personal" charts of interest thread and noted you sold 3 trades on Aug 22 at 92 cents.
Congratulations and well done.
 
The pullback found support at Fib 38.2%. Volume looks good too. Ready for re-entry.

 
BUBS Australia moving north again and approaching resistance at 85c.

 
BUB spiked 7.19% today on news that it has signed a supply agreement with New Times Asia with a total sales commitment for purchase orders valued at $17 million in FY19, and increasing to $24 million in FY20, and $37 million in FY21. Under the deal New Times Asia will supply Bubs and CapriLac products to up to 20 e-commerce platforms in China.

In spite of that apparent good news it still couldn't finish above the 85c barrier where it seems to be encountering serious resistance. It reached a high of 87.5c immediately after the open but dropped back under 85c within a few minutes and spent the rest of the day there, finishing at 82c, half a cent off its low of the day.

 
BUB has tried and failed to break through and stay above resistance at 85c on three separate occasions. In November last year it broke out but fell back under 85c after a week of lower highs and lower lows. Today it tried again for a fourth time. Fourth time lucky?

 
Well, six months later and BUB has taken some heavy hits to its share price. In the last few days it has tumbled through support at 45c and is currently trading at 37c and is looking very sick. No announcements have been released in December so this most recent share price decline is a bit of a mystery.

The last quarterly showed an operating loss of $8.5 million and expected cash outflows for the current quarter of $15.2 million. Cash at bank was $31.7 million at the end of the last quarter.

The market appears to be losing confidence in BUB. Does anyone following it a little more closely have any insights into what the real problem is? Is it tension with China over trade or just continuing operating losses that will eventually result in another capital raising?

 
Capital raising seems inevitable if they are burning through cash at this rate.

The price of speccy's I guess!
 
Price bounced off the 0.37 low pretty quickly and then rallied after a seemingly good quarterly update.
In spite of its massive growth potential. This is not one I'd trade, but for the record and research applications I've noted it here.

The chart below is part of a research project and should not be considered a recommendation to buy this stock. If you want to read more about the project log in to read the P2 Weekly Portfolio thread.

Setup: Solid chart basing pattern.
Grade B due to my concerns.
Buy limit: 0.55, iSL 0.45, let it go, trail stop

 
Bubs Australia muscles into post-infant market via launch of organic toddler snacks

Bubs Australia (ASX: BUB) has tapped into the post-infant nutrition market segment with the launch of organically-certified toddler snacks.

According to Bubs, the eight-snack range is based on organic vegetables, fruits, ancient grains and nutrient dense superfoods suitable for children aged one-to-five years of age.


The product range has been fully certified by the Australian Certified Organic (ACO). More...

 
Looks like BUBS is gearing up for expansion mode. From announcement on 3rd April:

Appendix 1: Capital Raising and Placement

The Company has entered a subscription agreement with C2 Capital Partners to raise approximately
A$31.44 million (before costs) at $0.65 per share.

The Placement to C2 will result in the issue of 48,366,888 fully paid ordinary shares in Bubs Australia.
The proceeds of the Placement will be apportioned A$25 million towards the Deloraine acquisition and
approximately A$6 million growth capital to accelerate China market development and brand marketing,
particularly in relation to Bubs proposed joint venture with Beingmate Baby & Child Food Co

On 1 April, Bubs entered a conditional Sale and Purchase Agreement to acquire 100% of Deloraine Dairy for $35M
in the form of cash and scrip, and $15M in deferred payments .
(Some conditions exist on a successful acquistion)

This is further to the MoU to form a JV with Beingmate, one of the largest Chinese
owned enterprises in the infant nutrition industry. as Ann linked to below.

Given this is not a retail placement Id not expect price to necessarily retrace to the 0.65c issue price. I could certainly find myself interested if prices push above 82c.
 
O h I didnt realise who C2 Capital were from my earlier post. From AFR....



Shanghai | A private equity fund linked to Jack Ma’s Chinese ecommerce giant Alibaba Group will own more than 15 per cent of fast-growing infant formula group Bubs Australia as part of a deal to acquire a Melbourne dairy manufacturer.

Bubs, which sells goat milk products to China’s middle class, has agreed to buy infant formula producer Australia Deloraine Dairy. It has agreed to a private share placement to new Hong Kong-based investment firm C2 Capital Partners, which will become a major shareholder in the company.

Alibaba is believed to be an anchor investor in C2 Capital, along with other institutions and sovereign wealth funds looking to capitalise on China’s middle class consumer boom. C2 Capital was established last year and the Bubs deal is its first investment.

The backing of a fund, which counts Alibaba as a key investor, is a win for Bubs as many of its rival brands would also like the Chinese ecommerce giant to invest in their businesses. Other Australian dairy companies sell their products in China via Alibaba's Tmall platform.
 
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