New Holding: 4basebio AG

4basebio AG (4BSB.D. Market Cap £74m, €1.78, 2.0% of JIC Portfolio and 0.0% of JIC Top 10)

New Holding:

On 23rd April, Leon Boros followed in my footsteps and appeared on the webcast, which can be found HERE

Leon is a very smart investor and was the man who I regularly thank for bringing Bioventix to my attention back in 2014.

In his presentation, he highlighted a relatively new purchase, which grabbed my attention. His commentary on why he bought it can be found at 35 minutes.

Not surprisingly, the share price shot up, virtually as he was speaking, with the highest volume traded since last August. Since then it has drifted back, giving me the opportunity to buy. Leon outlines the buy case and the bull and bear points. The slides are below.

I realise adding a new stock is a funny way of increasing my cash towards my target 10.0% but apart from a potentially exciting future, a big attraction is a big discount to cash on the balance sheet. In other words, one is buying £1 of cash for around 75p!

I have ranked it as High Risk/High Reward and have thus bought a 2.0% position. One could argue that with all the cash, it should be Medium or even Low risk, but I think, given the size of the business, and the risks re its strategy, High is appropriate, at least for now.

In his commentary, referring to Wilhelm K.T Zours purchase of a 21.0% position, (up from 16.3% in November), Leon says “Very shrewd guy, I like to follow smart people”. Well so do I and by adding this to the portfolio, I think I am following two, Leon and Herr Zours.

Hopefully, this, like Bioventix, will be a good long-term value creator for the JIC Portfolio but like all stocks, is not without risk.  I paid €1.773, (155.04p). I don’t think this is a share where one needs to chase the share price, which given the liquidity in the stock can be squeezed higher on little volume.  I have more to buy but won’t be chasing it. 


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