Doug Goodwille from Kayne Anderson speaks to Drew Meredith from The Inside Network on market thinkers.
While a surging gold price is on hold as the world adjusts to a Trump presidency, all the factors that saw its price rise more than 50 per during his first term in office – trade disputes, fiscal deficits and geopolitical tensions – are almost certainly guaranteed the second time around.
Grease me up as Cobram Estate hits the market
So far 2021 has been a standout year for initial public offerings (IPOs). With 103 listings already having joined the ASX lists, there are 22 in the pipeline until the end of September. The best-performing sectors have been health and life sciences, averaging 27% gain per listing. In second place are resources listings which on average have returned 16%. In this article, we’ll look at two promising new listings.
Cobram Estate Olives (ASX: CBO) is Australia’s leading olive oil grower and producer of world-class extra virgin olive oil. The company says it is the perfect chance for people, whether they’re interested in award-winning food brands or sustainable agriculture or watching their investments grow, to invest in a great Australian-grown and owned company. Shares listed on the ASX last Wednesday at $1.90, hitting a high of $1.99. (Cobram Estate Olives was not an IPO; it was a “compliance listing,” in which a privately-owned company moves its shares onto the ASX without raising capital.)
The company was founded by Paul Riordan and Rob McGavin in 1998. It didn’t take the duo long before they took the title as Australia’s market leader in the olive oil industry. McGavin says the company has “more than 2.4 million olive trees planted in Victoria and, this year, we estimate we’ll produce 71 per cent of Australia’s olive oil crop”.
Here are some of the detail of the listing:
- The company produces oil for the Red Island, Cobram Estate and Wellgrove brands
- It has more than 2.4 million olive trees on 18,000 hectares and is looking to grow its operations
- A raising was considered at a bottom price of $2, but it was decided that the market should first establish the stock’s valuation
- The company already has 850 shareholders which include founders and employees.
- The listing will provide much needed liquidity for shareholders.
Cobram’s aim is to expand its operations into California. The prospectus can be downloaded here – https://cobramestateolives.com.au
Bluebet (ASX:BBT) – Following on from the success of Pointsbet Holdings (ASX:PBH) and Betmakers Tech Group (ASX:BET), whose shares are up 100% and 180% respectively in the year, the hope is that Bluebet follows in their footsteps. Shares listed mid-July, raising $80 million at $1.14 per share. BBT is now trading at $2.10: that’s a cool 84% gain if you were able to get in on the IPO.
The shares began their run after the company signed an agreement with the operator of Q Casino (a combination of greyhound racing track and online casino in the US), the Dubuque Racing Association. It allows BlueBet to conduct its online sportsbook operations in Iowa as part of Dubuque’s existing casino licence. The US market is huge, and has a lot more potential than the Australian market. Investors are hoping that the company can seize this opportunity and experience significant growth. The licence is for an initial five-year period and will automatically renew for a further five if BlueBet chooses to do so.
The BlueBet share price rose again on the back of another agreement with the Colorado River Indian Tribes (CRIT) and its wholly-owned subsidiary, BlueWater Resort and Casino, to pursue online sports betting market access in Arizona. Broking firm Morgans has an Add recommendation with a target price of $2.44. The broker is positive on the exclusive agreement with the Colorado River Indian Tribes (CRIT) and BlueWater Resort & Casino (owned by CRIT). The agreement helps mitigate the risk of an unsuccessful outcome in Virginia.
