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Holista Colltech (ASX:HCT): A powerhouse of unique health and wellness products

Image Source: HCT Website

Summary

  • Holista Colltech is a vertically integrated provider of unique and patented wellness products and natural ingredients, catering to the growing needs of natural medicine.
  • All divisions, including food ingredients, supplements, infection control, and ovine collagen, are growing strongly.
  • Significant market exposure and patented/proprietary technologies provide positive tailwinds to Holista’s wellness products in a global market valued at US$4.5 trillion. 

Self-care and healthy lifestyle are not just buzzwords as the growing consumer consciousness takes the driver’s seat in purchase decisions.

In the current scenario marked by an increasing level of nutritional enquiries, natural wellness company Holista Colltech Limited (ASX:HCT) is positioned well with its suite of healthy products.

The research-driven biotech company, which was formed from the merger of Holista Biotech Sdn Bhd and CollTech Australia Ltd, is dedicated to delivering first-class wellness products and natural ingredients.

What’s more, the Company leads in research on herbs and food ingredients, and is a vertically integrated provider of health-style products to address the unmet and growing needs of natural medicine.

RELATED ARTICLE: Holista Colltech (ASX:HCT) ropes in new board member to fuel growth

Backed by its versatile range of robust product pipeline, the Company posted resilient results in 2020 against the backdrop of the COVID-19 outbreak.

As Holista Colltech continues to expand its operations with extensive presence across Asia (Malaysia), Australia, and the US, let us look at the Company’s key divisions and the robust market potential.

Data Source: HCT updates

Healthy Food and Ingredients

Holista has a full range of low GI (glycemic index) foods, which have been tested and validated by the University of Sydney. These products are associated with significant reduction of blood sugar levels, as GI indicates the ability of different carbohydrate-containing foods to raise blood glucose.

Holista’s GI LiteTM premix allows food manufacturers to produce healthy breads and noodles without compromising on taste. Baked goods supplier, Costenzo’s, has started selling white bread using GI LiteTM in several supermarkets in the US since April and Holista believes this will be a key growth opportunity for the Company.

GI LiteTM can also be used to make flat breads, noodles and pasta. Holista is currently doing early trials with other food manufacturers around the world.

Another innovative product is 80Less™, a sugar substitute that taste like sugar but with 80% less calories. The product is currently used by a Malaysian Stock Exchange listed beverages maker, Rex Industries, and Holista also believes sales of GI LiteTM and 80Less™ will accelerate over the short- to medium-term.

Ovine Collagen

Holista has developed cosmetic collagen using a patented process at its facility in Western Australia. This product is highly sort after by cosmetic manufacturers around the world as Australian sheep are recognised as being disease-free and a culturally acceptable collagen source as opposed to collagen from other animals, such as pigs and cows.

Holista’s collagen is marketed with Halal certification and collagen is widely used as a natural and safe biomaterial for manufacturing cosmetic products such as skincare lotions and creams, anti-aging and cosmeceuticals, face masks, haircare, and toiletries.

Significantly, Guangzhou Sinbio Cosmetic Co Ltd, which is a Chinese State-Owned Enterprise (SOE), is currently running trials using Holista’s collagen innovation through the Company’s agreement with Mutiara Seribum.

If the trials are successful and Mutiara and Sinbio can secure regulatory approvals in China, Holista will get a binding sales contract that it said will be worth around $3.6 million (for 48 tonnes) in the first year of the contract (total FY20 group revenue was AU$7.1m).

This will grow to 576 tonnes (12 times the initial purchase) by year four.

Health Supplements

The Company markets and sells 37 different propriety supplements through its two wholly owned subsidiaries, while new products are in the pipeline. Health supplements from Holista include Pristin® MOPL™, which contains third-generation Omega-3, coming in unique phospholipids structure to make it both fat and water soluble.

Clinically proven to have significantly higher nutrients absorption rate over other marketed products, Pristin® MOPL™ boosts cognitive performance and can improve overall function of heart, kidneys, liver, lungs, and skin.

Infection Control

Infection control division has emerged as the Company’s latest revenue stream. Notably, NatShield™ Spray from Holista has been developed from bioflavanoids using a proprietary technology, Path-Away®. NatShieldTM Spray can kill over 170 viruses, fungi, and bacteria, that too naturally and without side effects.

The M3 System® Distribution Module, which dispenses via a heating, cooling and ventilation system (HVAC) product in minute-metered doses to the environment, has proven significant when coupled with Path-Away®.

As per the Company, Path-Away kills 99.9% of COVID-19 virus (SARS-CoV-2) within two minutes, highlighted by Microbac tests. 

COVID-19 Test Kits – Holista has secured exclusive distribution rights to 15 million SARS-CoV-2 rapid test kits made by Guangdong Hecin Scientific Inc of China. It has also received the first order to supply COVID-19 test kits in Malaysia. The Company has distribution rights for the UK, Malaysia, and 10 other Asian countries.  

Upcoming launches from the infection control division include

  • Wipes developed by Cool Hands in the Netherlands in collaboration with GICC to be launched in Malaysia by Q4 2021
  • Nasal balm to be launched in the US, Singapore and Malaysia by Q4 2021

What paints a rosy outlook for Holista Colltech?

Holista’s market cap is low even as it continues to witness positive tailwinds as the current global trends support further growth momentum over medium-to-long term for all divisions.

Meanwhile, the Company holds a strong track record of proven success as highlighted by the 2020 full-year revenue of more than AU$7 million despite the COVID-19 global crisis.

Global reach with customers coupled with the Company’s proprietary/patented technology has proven to be of significant value, bolstering the  current growth plans. Holista Colltech, which remains funded to execute on current growth plans, also projects to expand its profit margin on 2020, on the back of cost optimisation and organic growth.

Road ahead for HCT Divisions (Source: HCT Presentation, dated 30 July 2021)


 


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