GenIP is set to list on London’s AIM on 2nd October, providing UK investors with an opportunity to gain exposure to the rapidly growing Generative AI phenomenon.

We outline five reasons why investors interested in technology and Generative AI should monitor the company closely as trade gets underway on the first day of dealings.

1. GenIP’s encouraging order flow and market traction

GenIP has already won new orders from research institutions keen to secure the company’s services. The launch of GenIP’s new Generative AI services in September has already generated over 40 orders for AI analytical assessments and three executive search assignments. GenIP is far from a concept and has hit the ground running.

As we explore below, GenIP operates in a sector rich with research organisations striving to commercialise the products of their innovation centres. It appears that, at least in these early stages, many institutions see GenIP’s services as a viable tool for assisting them in this process.

2. Strong management team

GenIP is helmed by a world-class leadership team. The board includes Lord David Willetts, President of the Resolution Foundation and Chair of the UK Space Agency, and Dr David Gann, Chair of UK Industrial Fusion Solutions and non-executive director of VenCap International plc.

CEO Melissa Cruz has extensive experience providing solutions to exactly the global research institutions GenIP are targeting their AI-enhanced analytics services at.

Technology specialist Selwyn Lloyd supports the board and CEO and has been instrumental in developing the Generative AI LLM at the heart of GenIP’s offering.

I’m short; GenIP looks to have the ideal mix of experienced oversight, technological capabilities and industry connections to secure success.

3. Substantial market opportunity 

GenIP is focusing on the opportunity in the Generative AI analytics market, which is set to grow exponentially in the coming years. A study has projected Generative AI in analytics will grow at a CAGR of 27.41% between 2024 and 2032 taking the market to a potential size of over $10bn.

One broader Generative AI market forecast predicts the industry could balloon to $1.3 trillion by 2032.

4. First-class client base 

GenIP has plans to forge relationships in sectors rich in innovation. Universities and research institutions are hotbeds for technological discoveries. GenIP’s opportunity resides in helping to fill the gap between generating innovations and generating revenue from them. Research institutions’ desire to commercialise innovations presents a market of potentially thousands of clients for GenIP’s analytical services. 

From looking at the websites of GenIP’s respective websites and the details released to the market so far, GenIP is already working with several institutions, including Brazil’s National Nuclear Energy Commission CNEN, Chile’s Fundación Copec UC, and the University of Huddersfield.

Non-Exec Director David Gann OBE’s existing positions on the board of a leading fund managers will support building a footprint in that sector.

5. GenIP’s attractive IPO structure 

GenIP is the latest IPO from the Tekcapital technology incubator, and it has a track record of successful IPOs. The most recent, MircoSalt, saw shares triple within six months before easing back. Although GenIP and MicroSalt operate in entirely different industries, the structure of the IPOs is very similar.

Tekcapital will retain a large proportion of outstanding shares after IPO and is ’locked in’. Other major shareholders are also locked in for a 12-month period. This prevents them from selling any shares for 12 months, creating a favourable environment for GenIP, avoiding the selling pressure some other companies face at IPO from existing shareholders. This dynamic helped SALT shares higher and is likely to support GenIP as trading begins in London.

Majestic Corporation, the specialist in battery materials, e-waste, and renewable energy waste recycling, has announced surging revenues and profits for the first half of the year.

Revenues for the first half of 2024 surged 92% to $25m as the company pursued global expansion of its circular economy solutions. Profit before tax for the period rose $1.2m.

“I am delighted to report an outstanding set of interim results which has seen revenue growth of 92%, profit before tax growth of 41% and earnings per share growth of 40%, compared to the 6 months to 30 June 2023. Growth was driven largely from the performance of the UK market, our battery materials and solar recycling operations,” said Peter Lai, Chairman, CEO and Founder of Majestic.

“As industries continue to prioritise sustainability and seek to secure control over critical resources, Majestic’s expertise in precious and industrial metals gives us a clear advantage.

“Whilst growth in the second half will not be of the same magnitude, the combination of our strategic agility and market insight ensures Majestic’s sustained growth and long-term success.”

Investors will be encouraged to hear that the company plans further expansion after acquiring one of its UK affiliates.

The company has enjoyed success in the UK, and it will remain a key focus for growth in the near future. However, Majestic touched on affiliates globally that could be targets for the next phase of growth for their recycling empire. South East Asia was named specifically as an area they have been ‘laying the foundation for sustainable growth’.

Circular Economy & Outlook

As a circular economy solution provider, Majestic Corporation sources, sorts and processes e-waste and renewable energy waste containing critical minerals such as copper, gold, lithium and PGMs.

The company said the board ‘remains cautiously optimistic’ about its outlook as it continues its plans to enhance margins and grow the top line.

With demand for these metals soaring amid the green transition and mining activities becoming increasingly expensive, the board’s optimism is more than justified with abundant commercial opportunity to return critical minerals back to the supply chain.

The FTSE 100 was deep in the red on Monday despite another bumper rally in Asian equities overnight, as hopes about stimulus pushed Chinese stocks further higher.

However, a storming session in China didn’t translate into a strong session for London and the rest of Europe, as the FTSE 100 dropped 0.6%.

Investors were more concerned about a downward revision of UK GDP growth over the spring, suggesting a gloomier picture for the UK economy than we had first thought.

“In the UK, ahead of a crunch Budget in a month’s time, the Office for National Statistics revised down its estimate of growth in the three months to 30 June to 0.5% from the previous 0.6%,” AJ Bell’s Russ Mould said.

The downgrade weighed on sentiment despite some analysts highlighting that slow growth may spur additional action by the Bank of England to support growth through rate cuts. There was also nagging concern about developments in the Middle East after escalation over the weekend.

“Sentiment is subdued amid heightened tensions in the Middle East and a revision downwards of UK growth for the second quarter. However, although this latest snapshot of the UK economy doesn’t, on the face of it, look inspiring, it may bolster the case for further interest rate cuts,” said Susannah Streeter, head of money and markets, Hargreaves Lansdown.

Stocks reliant on the UK consumer were among the top fallers on Monday, with Frasers Group, IAG and Easyjet feeling the pinch of slower UK growth. UK banks, including Barclays, were also sold off by investors after the data.

Rightmove was the top faller after confirming it had turned down a fourth offer from Rupert Murdoch’s REA Group. Rightmove shares were down 6% at the time of writing.

In a statement released on Monday, Rightmove said:

“The Board has unanimously concluded that the Latest Proposal is unattractive and materially undervalues Rightmove. The Board has concluded that shareholder interests would be better served through the execution of Rightmove’s standalone strategic plan, with the multiple paths for long-term value creation which were laid out at the Capital Markets Day in November 2023.”

Although the FTSE 100 was weaker, commodities companies showed some strength amid the rally in China and rebound in oil prices. BP, Shell and Rio Tinto were all higher by around 1%.

Late last week dealing volumes in the main market listed Neo Energy Metals (LON:NEO) were almost doubled following news that it had signed formal documentation for its South African 90Mlb Uranium Acquisition at Beisa North and Beisa South. 

The Business 

The shares of this Uranium developer and mining company are also quoted in South Africa on the independent stock exchange A2X. 

It holds up to a 70% stake in the Henkries Uranium Project, an advanced, low-cost mine located in South Africa’s Northern Cape Province, which has been estimated by some that the historical investment in the project was over $30m in exploration and feasibility studies. 

The company aims to increase the project’s mineral resources and complete an updated feasibility study with the aim of bringing Henkries into production in the shortest possible timeframe. 

It also holds a 100% interest in the Beisa North and Beisa South Uranium and Gold Projects in the Witwatersrand Basin, located in the Free State Province of South Africa.  

The combined projects record a total SAMREC Code compliant resources of 90.24Mlb of U₃O₈ and 4.17Mozs of gold. 

The SAMREC Code sets out minimum standards, recommendations and guidelines for Public Reporting for solid minerals of Exploration Results, Mineral Resources and Mineral Reserves in South Africa, giving conformity in project promotion. 

Neo Energy’s strategy focuses on an accelerated development and production approach to generate cash flow from Henkries while planning for long-term exploration and portfolio growth in the highly prospective Uranium district of Africa. 

Transformative Acquisitions 

CEO Sean Heathcote stated that: 

“The Beisa North and Beisa South Uranium Project acquisitions are transformative for the Company. 

The Beisa Projects contains over 90 million pounds of uranium resources and over 4 million ounces of gold resources and are located on two granted Prospecting Rights, over an area of approximately 80km² in South Africa’s primary uranium producing region.  

Importantly this is a region where uranium has been mined continuously for over 70 years and where at its peak there were over 40 uranium mines in production.  

It is also historically one of the richest gold-producing regions in the world, having produced about 2 billion ounces of gold over more than a century.  

It truly is a great place for Neo Energy to strategically consolidate its position in South Africa’s uranium sector. 

We will now look to progress the regulatory process with the South Africa authorities and commence work at the Beisa North and South Projects.   

In parallel with this, we will look to finalise some of the additional acquisitions, that I believe will further strengthen our position in the region and demonstrate our intent in South Africa’s uranium sector. 

As we move forward, our commitment to innovation, operational excellence, and responsible resource management remains steadfast and we look forward to working closely with all our stakeholders to ensure the successful advancement of Beisa North and Beisa South, setting a strong foundation for future growth and value creation.” 

Broker’s View 

Jason Robertson, at First Equity, rates the expanding group’s shares as a Buy, while upping his Price Objective by 15% to 23p a share. 

He notes the group’s ambitious strategy to establish itself as South Africa’s leading Uranium mining company and one of Africa’s major uranium mine operators and developers, and the plan to consolidate itself with additional acquisitions.   

With the deal to acquire the Beisa projects now signed and secured we have removed our 10% project sign off risk, therefore lifting the share price valuation from 20p to 23p, representing a risked value of $763.1m for the combined Beisa and Henkries projects for both uranium and gold assets.  

In My View 

I was impressed to see that various of the group’s Directors have opted to take shares at 1.25p each in lieu of their fees and salaries – which is surely an act of financial faith by its ‘insiders’ – that is well worth following. 

With Robertson’s upped Price Objective being over 19 times the current market price of 1.18p – they appear to have some significant upside.