Security Matters Limited (ASX: SMX) is primarily involved in providing brand protection and supply chain integrity solutions to the businesses. Its patented unique technology utilizes a hidden barcode (chemical-based) to permanently ‘mark’ any object (solid/gas/liquid). The barcode is read using the company’s unique ‘reader’ to access the equivalent stored data, recorded and protected using blockchain technology. In an era of the digital economy, SMX is trying to maintain trust in the physical assets and processes, by allowing identification, quality assurance and tracking supply chain movements.
The company was listed on ASX in late 2018 and within less than a year, the stock has provided a return of around 112.2% to its investors. This is a testament that the investors have a positive outlook about this brand protection, supply chain integrity and blockchain technology-based company with a strong belief in its disruptive technology. The company recently raised $6 million before costs by completing an oversubscribed share placement (12.4 million ordinary shares issued at $0.50 per share). The placement was completed 2.5 times the IPO price further demonstrating strong growth and support from the market.
In the recent past, the company developed various commercially meaningful relationships with several international organisations. The company has been partnering with global leading players across several sectors to protect brands, sectors and becoming the global record of physical goods.
Recently, SMX signed an agreement to commence a feasibility study with world-leading animal nutrition firm, Bluestar Adisseo Company. Under this agreement, both the companies will commence a pilot project to evaluate how Security Matters’ disruptive technology can be incorporated into Adisseo’s animal feed additives, to protect the Adisseo brand, secure the integrity of the industry and allow good incorporation into the feed.
Furthermore, the company has also signed an agreement with Trifecta Industries Inc, a leading player in the diamond industry, to commercialise the company’s trace technology for diamonds. Under this agreement, Trifecta is going to invest US$500,000 in four tranches over a projected 10 month period to commercialise and scale SMX’s patented technology for the diamond industry. The agreement signifies company’s strategy in taking significant steps in commercialising its identification technology.
The company is working diligently to build strong relationships with leading companies globally and to expand its reach within the different sectors. The company also inked an agreement with The Perth Mint to commence full-scale development of bespoke mark and trace technology to be used exclusively by The Perth Mint, representing a significant achievement for the company as this was the first commercial agreement to be signed with a leading Australian company.
In the 2019 March quarter, the company signed an exclusive development and supply agreement with the medicinal cannabis distributor, CliniCann. Under this agreement, the company will be incorporating its revolutionary mark and trace technology into the primary and secondary packaging of all products manufactured by CliniCann’s suppliers being distributed to all territories, excluding the USA.
During the March quarter, the company completed phase II testing of its seed integrity solution, with company’s marking technology having no impact on the seeds’ properties. It is expected that the phase III testing will begin in Q2 2019 and its completion will symbolise full commercialisation of SMX’s agricultural offering. During the quarter, the company also completed electronics testing which successfully assessed SMX’s ability to incorporate its mark and trace technology into existing manufacturing processes of large electronics manufacturers. This testing also demonstrates how easy it is to incorporate company’s technology into the existing systems and processes of any manufacturer across all sectors.
The company is planning to secure additional collaboration agreements and proof of concept projects so that it could successfully deliver on business model and commercialise its disruptive technology with an edge over its peers for the competing technologies.
Advantages over Competing Technologies (Source: Company Report)
Recently, on 15th May 2019, the company held its Annual General Meeting, in which it passed six resolutions, which includes five ordinary and one special resolution. At the AGM, the shareholders gave their approval for an additional 10% Placement Capacity (Special resolution).
In the last three months, the share price of the company increased by 67.31%. SMX’s stock last traded at $0.435, with a market capitalisation of circa $47.81 million as of 15th May 2019.
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