Plandai Biotechnology Inc (OTCMKTS:PLPL) Continue Flying High
Plandai Biotechnology Inc (OTCMKTS:PLPL) have really been moving throughout the last couple of months. It all started around March 19 and you can see that since then, they have gained nearly 500%. There is a pump campaign running for them, but no matter how big or small they are, the newsletters are not able to affect the ticker to that extent on their own. So is there something else pushing PLPL higher and higher?
Well, if you do just a quick and not very in-depth research on PLPL, you’d be forgiven for thinking that what we see here is something very rare in Pennyland – a rise in the share price caused by actual progress.
According to the descriptions available all over the Internet, PLPL is a company that is poised to change the world of nutraceuticals and pharmaceuticals with their patented technology that will enable them to produce extracts in a very efficient way.
You will also find press releases according to which some people with long and impressive CV’s are joining the team and you will also see that PLPL are, apparently, reaching agreements with companies from around the world which means that the market for the new extracts is becoming bigger and bigger.
And you will find a financial statement that looks like this:
- cas: $1.3 million
- total assets: $8.7 million
- total liabilities: $9.9 million
- revenue: $131 thousand
- net loss: $507 thousand
While it’s not perfect, this financial report looks a lot better than what we’re used to seeing from penny stock companies, but what’s even more impressive is the amount of progress that they have made in just twelve months. The revenues for the same period of 2011, for example, amounted to just $13 thousand. Before you get too excited, though, there are one or two things to consider.
Remember the ground-breaking extraction technology that PLPL are so proud of? Well, they are not quite ready to implement it yet. In order to do that, they will need to build a factory in South Africa which puts things into an altogether different perspective. PLPL recently announced that the first shipment of machines and equipment has been made, but the financial statement for the period that ended on December 31, 2012 informs us that they will not have the product ready until Fall 2013. If you check out their previous report (the one for the three months that ended on September 30, 2012) you will see that they were a bit more optimistic – back then, the deadline was Summer 2013 – and if this trend continues, the next report should state that the extracts will go on sale in 2014, which, we’re sure, won’t go down well with the shareholders.
We know what you’re thinking right now: “If the factory is not ready yet, where are the revenues coming from?”. Well, if you read through the “Sales” section of PLPL‘s report, you will see that the proceeds are coming from something altogether much more conventional – sales of avocados, macadamia seeds and timber.
All in all, PLPL‘s real long-term success is dependent on two things that we have yet to see – a factory for the extracts and, of course, a positive cash flow generated by them.
In the meantime, the awareness campaign is heating up. We see more and more newsletters jumping in on the bandwagon, there are quite a lot of users being overly optimistic around the message boards and a couple of days ago, there was a press release according to which a website called Stock House Group issued a research report on PLPL. We read through it and we can report that it looks pretty similar to the promotional emails that we receive nearly every day. According to their disclaimer, Stock House Group have received $2,500 for their report and the fact that more and more entities are trying to create excitement around PLPL reminds us of last year’s campaign for them.
The touting began back in January 2012 and the emails were flying around virtually non-stop for the better part of two months. As you can see from PLPL‘s chart, this did give the ticker a boost, but when the excitement died down, the price followed suit and there really is nothing to stop history from repeating itself. That’s why it pays to be extra careful when making your decision on PLPL.
