The Punter has a somewhat mixed record of investing in agribusiness.
He sold Elders (ASX code ELD) far too soon, paid too much for Abundant Produce (ABT), should have bought Bellamy’s (BAL) at the beginning of March and probably should never have bought Australian Dairy Farms (AHF) at all.
But he has also had a few wins, and he could hardly be worse than some of the highly paid professional advisers who price the shares when they are first offered to the public.
Look at Wellard: floated at $1.39 in December 2015. Three months later they were worth half that. In April this year they tried to flog 106 million more shares at a mere $0.185 and only managed to sell just over half that number.
JiaJiafu Modern Agriculture (JJF) priced at 30c for its debut in March this year, opened at 26c and was last seen at 16c. Murray River Organics (MRG) floated at $1.36 in December and is now around 39c.
They often get it just as wrong the other way: Abundant Produce was launched at 20c in April last year. It opened at 55c and within a fortnight was nudging a dollar. The float should have raised twice as much for the company as it actually did.
Abundant is still just a seedling. The share price appears to have stabilised around 40c but the market is very thin, with a 10 per cent gap between the bid and offer price.
The Punter is tempted to “double up” and reduce his average cost (he paid 55c in February) but is waiting to hear that ABT has finally nailed its first big sale.
To be fair to Murray River Organics, it did rain on their sultanas. The worry is not just that they have had to twice downgrade their forecasts, but that their latest estimate showed that they might not have enough revenue to meet the conditions attached to their bank finance.
The NAB agreed to a waiver after what must have been some tense discussions over a weekend, but MRG’s debts are a worry.
• The Punter has no financial qualifications and no links to the financial services industry. He owns shares in a number of companies featured in this column.
