The Growth Government
So, we have had our Budget for growth, a bold and visionary use of £40bn and all the extra borrowing. I note that the powers that be in the City have suggested that for AIM and the stock market it was not as bad as feared. But I would suggest that this how most boiling frogs feel as the temperature of the water rises. Indeed, the only reason that our City “representatives” would say things are not as bad as it could have been is to justify their existence. The bottom line is perhaps that as former Chancellor Norman Lamont has said in the Telegraph today, Governments do not deliver growth, it is businesses. Borrowing to invest, the current mantra for growth assumes that Governments know what to invest in. As we saw with the pandemic, the Government does not even know where to source a face mask successfully, let alone economic growth.
Kemi
After an overly long process, akin to electing the President of the United States, we have the initial favourite winning the Conservative party leadership. On the face of it Kemi Badenoch has 4 years to become Prime Minister. What is interesting here, especially given the lay of the land, is that the only way she will become Prime Minister is to break away from the LabCon pact we have had since the fall of Margaret Thatcher. Of course, she could hope, as Keir Starmer managed, that the existing Government will become so unpopular that the Premiership will be delivered on a plate. However, unlike Labour, the Conservative vote is now divided by Reform. But from the initial noises it could be that Kemi is someone who genuinely wants to shake up British politics. If, as it would appear, she is very ambitious, the only way of getting to number 10 will be by breaking the mould. In this way she may actually be aligned with the interests of the now battered British people.
Running A Business
Quite rightly, in the wake of the Budget, The Times asked the question, “who would want to run a business?” Given that the Government is set to borrow far more than it is to raise in taxes, the rather obvious conclusion is that the Budget’s main goal was to erode the private sector, and make the public sector the only real game in town. The message is to either work in the public sector, or if you really want to run your own business make sure the public sector is a customer. There are a few companies on the market who come to mind who supply the NHS, MoD, infrastructure, and perhaps these such as Totally (TLY), Hercules (HERC), Kromek (KMK) et al, are the way to go for investors. Indeed, Kromek got a mention in the Investors Chronicle this week.
Georgina Energy
As well as the Budget, the lack of any meaningful pressure group help, and all the red tape, which one would be sure will only increase under Labour, small cap companies also have the blogosphere to contend with. The bulletin boards, telegram, and X in particular are all sources of social media for CEOs to contend with, which private companies in general, do not have to cope with. Sometimes the social media comments can be constructive, but of course normally they are there to vent steam, or deliver an agenda. In the case of Georgina Energy (GEX), the fact that the shares are still holding up relatively well, despite all the mud being thrown at the company, means that the shorters are getting more and more frustrated. This is a point underlined by the school playground name calling, the factual hairsplitting, historic allegations that have no relevance now. Basically, the full playbook of the shorting conspiracy. What the shorters forget, because it suits them, is that the journey towards an IPO (in this case a RTO) is one of the most arduous in terms of due diligence. Rather than sling mud, let’s see how GEX does with Hussar and Mount Winter in terms of re-entering the wells, especially after last month’s upgrade of Hussar.
ProBiotix
One of the points that I have suggested of late as far as requisitions, is that rightly or wrongly, the incumbents tend to prevail. This has been the case, quite rightly, in the case of ProBiotix (AQSE:PBX), which prevailed against Seneca this week. Actually, the cause in favour of change at PBX was perhaps not helped by the RNS issued by OptiBiotix (OPTI), from which PBX was spun off, as it rather made the whole affair look rather unseemly. Despite this, shares of PBX rallied 45% at the end of the week, and should rally even more now that the company is free to do its own thing. The question now is what will happen to OPTI, without its PBX golden goose, and no doubt weakened after all the recent distractions and shenanigans.
The Week’s Risers
While to some the relief regarding tax rises affecting the stock market was inappropriate, it was the case that coincidentally some of the more recent flat situations came to life. They included Emmerson (EML) which is set to enter a formal dispute with the Moroccan government, ironically after most investors have thrown in the towel. A decent rebound was awarded to United Oil & Gas (UOG), quite rightly, as the company has finally drawn a line under its Egyptian campaign. Particularly enjoyable was the 90% rise in MicroSalt (SALT) shares, where news of several new bulk orders undid the false flag RNS of last month. Here the chart was the winner, after the bear trap from below 45p and the initial IPO listing price. Ondo Insurtech (ONDO) felt the benefit of Monday’s RNS which said the company was boosting factory capacity, and of course an interview with my good self, after what seems like months. Alkemy (ALK) continued to rise in the wake of announcing an advisor to get a convertible bond for TVL.
Ondine Biomedical
An exciting company where it would appear that the fundraising phase is now finally out of the way is Ondine Biomedical (OBI). Here we have in recent weeks been treated to the significant gains made by its flagship Steriwave antimicrobial treatment. With now potentially up to £11.3m in the kitty for its US clinical study, one would imagine the company is on its way in terms of the rollout, and the share price.
Ananda Developments
Ananda (AQSE:ANA) is a company which one would assume will be just as revolutionary in its field as OBI shall be. This point was underlined this week with the release of its interim results. The company, which is developing CBD based medicines to treat complex, chronic inflammatory pain conditions, has funded trials which are funded by NIHR and NHS England. In these researchers will study whether MRX2 & MRX2T are safe and effective in reducing the number and severity of seizures experienced by people with epilepsy.
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