Propanc Health Group Corp (OTCKTA:PPCH) Turns Green
Propanc Health Group Corp (OTCKTA:PPCH) managed to make a slight recovery yesterday, moving 8.80% up the charts in spite of all the red flags surrounding the company.
And suffice it to say that said red flags are as myriad as they are varied. Just one look at the company’s financials should be enough to make investors cringe:
- Cash – $168 thousand
- Current Assets – $308 thousand
- Current Liabilities – $2.1 million
- NO REVENUES
- Net Loss – $454 thousand
But that’s not all – no, not by a long shot. PPCH is a development state pharmaceutical penny stock – and what’s the biggest bane of investor value in that specific branch of the OTC Markets?
Why, toxic funding is, of course. It is the one thing most companies in the sector have in common, whether they are idle or active, promising or obvious duds. And, as the report we mentioned above can attest, PPCH has not missed out on the opportunity to issue convertibles that could drown the market in cheap shares.
The prices of most of the convertibles listed on pages 17 and 18 of the 10-Q list conversion prices of the shares range between $0.0006 and $0.0035.
And, as some research can attest, it’s not like the noteholders are just sitting idly by, refusing to cash in on the action:
- as of November 19, 2014 PPCH had 91 shares of common stock
- as of February 16, 2015 PPCH had 192 million shares of common stock
- as of May 15, 2015. PPCH had 335 million shares of common stock
Add the fact that we’re still talking about a DEVELOPMENT STAGE company, that still has years of costly research ahead of it before it can even start thinking about licensing and FDA approval and then manufacturing and distribution of a product.
The emphasis in the previous sentence should also fall on COSTLY, as in – PPCH is going to need more funding to carry on with its research, and the method of acquiring it will probably involve more dilution.
Those warning signs should be enough to make any diligent investor be ware.
