Who is Supply@me Capital PLC Fintech Company
Supply@ME Capital PLC (LSE: SYME) is a financial technology vendor platform that provides an alternative way for companies to raise capital by leveraging their own inventory. Manufacturing and commerce companies can strengthen their cash flow and capital positions through a true sale’ of the warehouse holdings to special purpose vehicles incorporated by SYME, which also creates a new asset class for investors.
We forecast 60% YoY net profit growth in FY21 based on 23% YoY revenue growth and margin improvement from new markets and a strong pipeline. We believe SYME’s shares are undervalued in the current variety of £0.50- £0.60 and would expect more movement in the £2.00 to £2.50 bucket to Q12021.
Lending disruptor
SYME isn’t a traditional lender, despite fulfilling most of the middleman duties. As a pure service provider, SYME matches funding providers with companies in need of liquidity. The assortment of industries it serves is almost unlimited. The exclusive model permits special purpose vehicles (stock companies), incorporated by Supply@ME to purchase the inventory, which is then leased back to the company, never leaving the warehouse.
As a pure-play digital lender or a stock-loan lender, SYME is up against powerful incumbents, with little ability to increase the kinds of sums required to make a dent in the aerospace or chemicals marketplace.
Where SYME differs is its role as a simple service provider, taking away the focus on its own balance sheet.
Revolutionary platform SYME is one of the first fintech to leverage blockchain from the lab into a dynamic, real-world use case. Not only is the back-end secure and tamper-proof, but the digitized stock tracker can also be retrieved in real-time.
Blockchain technology and the emerging smart contracts space are upending traditional ownership transfer processes. The entirely digital SYME frame renders an electronic certificate of physical stock, allowing for immediate transfer of funds to the customer in return. The need for physical transport of property or access to grounds is eliminated, and the possession monitoring of the stock is permitted through SYME’s blockchain.
A permanent record of transactions is created, allowing SYME to monitor the development of the inventory because it is sold, with a collection of algorithms tracking for breaches or losses. SYME’s secure system guards against risk, providing security for both sides of the trade.
Supply chain efficiency
SYME plans to drive future growth by targeting food retail and wholesale, and other verticals with notoriously lengthy supply chain hold-ups and improving its software products to provide more value to existing verticals.
Global supply chains are in disarray over the prolonged effect of the coronavirus crisis, with a second wave looming and no end to the disturbance insight. One of the big decisions facing supply chain executives now is balancing investments between low seriousness, highly probable events, and the black swan occurrences of high severity, low probability events, like Covid-19. At present, investments made in the prior greatly outweigh those made in the latter because most risk events like natural disasters reveal an important feature — a similarity with past events.
Historical demand and supply information, previous answers, and retrieval roadmaps all feature, real-world-tested risk management protocols, and reliable disruption action plans. Coronavirus has wiped the slate clean, there’s no data, and firms are now stuck trying to balance investments with very little knowledge of the horizon. Immediate access to working capital becomes critical for swathes of businesses, and particularly the ones that hold significant concentrations of inventories, like manufacturers of personal protective equipment (PPE).
The business needs its inventory ready to market at minimal notice, but also needs to have cash allocated for further purchasing inventory. When tied up, there’s little access to the necessary liquidity. SYME resolves this problem, and a further pandemic could trigger an upward stock price catalyst, in our opinion.
Lean structure and strong cashflows
SYME has an exceptionally powerful product and software development team alongside its core business development team entrenched in key markets. The current move to London helped solidify SYME’s standing as a bold start-up with an attractive proposal, given the attention foisted on it by London’s creditors looking for value amid market turbulence. For FY21, we expect 60 percent YoY core net profit growth driven by 23% YoY revenue growth and margin improvements from entering new markets and further expansion in the ME and US. Growth by M&A is also possible, given strong net cash post-IPO and the fractured digital monetization landscape.
Analysts have begun to pick up fintech which is braced to ride over marketplace headwinds as regulatory forces are loosened to assist the global economy recover.
We would expect SYME to capitalize on the difficulties faced by companies who are sitting on stock and not able to free up liquidity so as to progress or push through the anticipated dip. Of the AIM’s standout performers this season, it is anticipated SYME will further enhance its standing through 2021, with selections from the £16.00- £17.00 range.
Multiple opportunities awaiting from Supply@ME Capital
Brexit and COVID headwinds are expected to make trading in the United Kingdom a once-in-a-generation opportunity as wild swings are called from the No-Deal tariff and money hits.
The expectation of reduced regulatory burdens and relief for start-ups, along with other business aid is large; the City of London and its strong pool of financial services companies will be open for business and looking for quick wins in markets outside its own doorstep in the wake of the split with the European Union.
We believe the anticipated influx of foreign multinationals drawn by tax cuts and the subsequent inflows of international brands, technology, and services will further increase the worldwide appeal of SYME’s solution.
Similar opportunities are apparent in the US and the ME, in which the lack of flexible, rapid monetization platforms available to business provides a huge incentive for first-movers.
Appetite for securitized financing is particularly high in post-recession markets, and unlikely to be affected by approaching elections and potential changes of government.
