The Pump For Plandai Biotechnology Inc (OTCMKTS:PLPL) Goes On

There have been quite a lot of newsletters touting Plandai Biotechnology Inc (OTCMKTS:PLPL)’s stock in the recent weeks and according to our database, a total of 14 emails worth $15 thousand have been sent since the beginning of May. That’s quite an effort and it seems to be paying off. Our last article on PLPL is dated May 6 and since then, they have gained around 30% in value. That’s great and if the pumpers are to be believed, the price will continue to rise. For how long, though?

As we mentioned in our previous article, if you take just a quick look through the publicly available information about PLPL, you will probably think that you have found a really good investment option. Things are not always as easy as they seem, though, and the case of PLPL is no exception.

Indeed, the current assets outweigh the current liabilities by as much as $700 thousand, the revenues have jumped sky high during the last twelve months and there seems to be a financial backing from some solid financial institutions in South Africa, but even so, there is a $507 thousand net loss for the fourth calendar quarter of 2012. Then there’s PLPL‘s really big problem.

As we mentioned, if you only take a quick look through the figures, you will probably think that the extracts that PLPL talk about at some considerable length have been rolling off the production line and that you just need to drop by at the nearest pharmacy and you will be able to buy products that use these extracts. The truth, however, is a bit different.

The $131 thousand in quarterly revenues that you will find in the latest 10-Q are actually coming from sales of avocados, macadamia nuts and timber produced in the tea plantation that PLPL lease in South Africa. The extracts that everyone is talking about will not go into production until a commercial-grade extraction facility is built and that won’t happen until Fall 2013. Or at least that’s what the 10-Q for the fourth quarter of 2012 says.

The report that was published before it, however, contains a different deadline – Summer 2013, and if you look further back, you will see that PLPL were expecting production to start around mid-2013, which goes to show that things haven’t been going according to plan.

One more thing to consider is the fact that the extracts are in different stages of FDA approval which means that even when the production facility is finished, PLPL might need to wait for a little bit longer before they can start selling the products. Once they do, there is also the question of profitability and right now, there is no one to guarantee that it will be achieved.

All this goes to show that the pumpers’ claims that PLPL “is about” to change the industry are nothing but hot air, but let’s say that we’re used to that. One of the latest newsletters to join the pumping party is Trade These Picks, owned by Investor News Source LLC (INS) who received $2 thousand for the awareness. On May 6, the newsletters affiliated with INS touted Graphite Corp (OTCMKTS:GRPH) and the result is pretty obvious from the chart.

As we mentioned in our previous article, it’s not just an email campaign, either. An entity called Stock House Group has been issuing reports and press releases related to PLPL. Just like INS, they also received a compensation for their work and just like INS’ newsletters, they also have a history of failed picks. One of the more recent ones is LifeApps Digital Media Inc (OTCMKTS:LFAP). Stock House Group’s Report on them is dated April 5 and as you can see from LFAP‘s chart, while the ticker managed to stay afloat for a couple of days, it soon lost its footing and crumbled.

All in all, there are some important things to happen before we can say for sure that PLPL‘s stock is a safe place for your money. Until we have evidence of all of them, this will remain just another pump effort and it could end up in the same way that the ones above did. That is why you should be extremely careful when considering your chances with PLPL.