fb106

Newsletter Archive Update Archive HotStockRockets share tip of the Month – Buy Vela Technologies at 0.16p – target 0.25p to sell At the bottom end of AIM there are a raft of investment companies most of which are absolute POS lifestyle companies. It is all too easy to write the lot off as vehicles to allow useless directors and City parasites to milk the gravy train, if that is not mixing metaphors. But there is the odd nugget of value and that brings us to this month’s share tip of the month, Vela Technologies (LSE:VELA). Vela trades at 0.15p-0.16p capitalising it at £720,000. As at September 30th net assets (its investment portfolio) were £810,000. Allowing for £90,000 of running costs in the second half (quite low for this sort of casino stock) but adding in a placing of £300,000 since we reckon that net asserts should be a minimum of £1.11 million. But actually that number is wrong. There is the odd dog in the portfolio. Vela owns a few shares in Rosslyn Data which Tom Winnifrith has just reported to the FCA. But mist of Vela’s investments are unlisted but are close to getting a realisation either via trade sale or IPO. The firm is run by Antony Laiker a very switched on veteran City operator and he seems to have invested wisely. The portfolio as at September 30th comprised holdings in: Disruptive Technology which manages investments in disruptive technology companies. Portr provides concierge airport, home, hotel, traveller luggage transfers. Rosslyn Analytics a cloud based analytics company listed on AIM. Social Superstore provides a social commerce platform. Advance Laser Imaging which uses laser scanning hardware and advanced software applications to produce 360 degree, 3D images. Stream TV Networks is a Philadelphia-based new media company which owns proprietary software enabling consumers to view 3D media without glasses. Imaginatik is a full service innovation provider offering a range of consultancy and technology products. The word on the street is that we have since September seen a material uplift at Portr and Disruptive and we thus expect a trading update for the full year to show a NAV of well in excess of £1.5 million. Small investment companies, especially those investing largely in private equity tend to trade at a big discount to NAV but we think that the discount to what we expect NAV to be is excessive. Ahead of that trading update we make this our tip of the month at a 0.16p offer with a limit buy price of 0.185p and a two month target of 0.25p to sell.