Concussion healthcare player HITIQ lifted up in late day trades on Bell Potter vouch

As far as unique healthcare smallcaps go, HITIQ (ASX:HIQ) is one of the more memorable. 

The publicly listed company’s flagship offering to the healthcare market is its CSX product suite, a concussion detection and management service. HITIQ bought CSX in 2021. 

In short, HITIQ is aiming to become a ‘one-stop-shop’ provider for concussion management and treatment services on a private commercial basis.

Currently, the company holds a contract with Rugby Australia (RA), and other sporting agencies in Australia. 

Growing sports contracts; defence on radar 

Throughout the RA season this year, all 23 teams (men’s, women’s and wheelchair leagues) are using HITIQ’s CSX product line to report all concussion events, as well as engaging with the company’s rehabilitation and assessment tools. 

That deal was minted between RA and HITIQ back in September; the smallcap noted at the time the deal would not be material to revenues. 

The company then scored a contract with the Premier League in early November, and announced another with the WA Football Commission only a day later. 

HITIQ also goes after Defence contracts towards the same end, but hasn’t had the same degree of success in that market so far. 

What does Bell Potter say about HITIQ? 

Today, the company’s share price has realised healthy gains heading into the last hour of trade as HITIQ reveals its latest bit of good news: stockbrokers Bell Potter are putting their weight behind the smallcap. 

Bell Potter (BP) outlined the following in a presentation it held today: 

• $3.5m Enterprise Value with cost-cutting strategy underway 

• HITIQ is aiming to break-even on cashflow within the next 1.5y 

• Concussion healthcare a “multi-billion dollar” market 

• Entry into an “exciting and emerging” virtual reality segment (VR concussion assessment tools) 

BP is also today advertising the company’s current renounceable rights issue (RRI) to raise over $6m. 

8 new shares will be offered for every 5 shares held by eligible shareholders at an issue price of 3c; shares are currently trading just higher at 3.5c (a 14% discount.) 

Existing shares at the date of offer sit at 132.4m; that number will rise to 344.2m post-completion. 

Broken down, only $1.1m of $6.3m in funds will be used for working capital. 

HITIQ wants $2.35m for IP acquisitions; $700,000 for marketing, and $1.9m for R&D. The offer will cost $0.30m, all in all, leaving HITIQ with more or less a flat $6m.

HITIQ's six month charts. The sharp spike in November followed the company's contract with the WAFC one day later