RLF AgTech, the latest crop-booster to list on the Australian stock market, finally began trading on Thursday last week under the ASX code RLF.
The initial public offer of shares raised $8.5 million, short of the maximum $10m the company had hoped for, but comfortably above the minimum $7m it needed.
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The group uses advanced proton technology to stimulate root growth and increase yields by around 30 per cent for crops ranging from rice and wheat to tomatoes, lupin, canola and even spinach.
It has a range of products for treating seeds, seedlings, and growing crops, with independent trials suggesting that the best results are obtained by combining seed treatment with later foliar liquid treatment.
Its technology avoids the damage to soils caused by traditional fertilisers and reduces the carbon footprint of crop production. It is currently exploring the opportunities for cashing in on carbon credits in Australia.
The Punter opted not to subscribe to the initial public offer of shares at 20c each last month.
The group's biggest market and its manufacturing base is in China, with most of its revenue in renminbi.
That raises the question of exchange rate risk, although RLF is expanding into the US, Brazil, Europe and India.
Nevertheless, it has a track record of steady growth since 2007.
It has won a string of technology awards, and saw gross profit jump 89 per cent in 2020/21.
Revenue in the first six months of the current financial year is up 44 per cent, despite COVID.
RLF shares initially opened at 24c on Thursday, but in Friday's weak market quickly slid below the initial public offering of 20c, in relatively thin trading.
The Punter has placed a cheeky bid for 15,000 RLF at 16c.
- 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.
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