Internet harvest starting to sour

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Internet harvest starting to sour

• The Sydney Morning Herald

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Author Author By KATRINA NICHOLAS
Date 08/09/1999

• Perth-based Internet software maker HarvestRoad
  had a steady debut on the ASX yesterday, but
  market watchers said the path for Internet floats
  remained slippery, with jaded retail investors
  now turning to biotechnology stocks.
• Internet companies still waiting to go public
  include Internet Service Provider iiNet, online
  finance player Investor Web and Fairfax Online.
• InvestorWeb and iiNet are set to list on
  September 30 and Fairfax is expected to announce
  a float of its Internet business as soon as this
  afternoon, when it issues its full-year result.
• HarvestRoad performed better yesterday than other
  recent Internet floats such as eisa and Isis,
  which both listed last week at a discount to
  their issue prices.
• Harvest began trading at 63c, a 3c
  premium, and dipped to 57c before recovering to
  close at 60c. Trade was sluggish with just
  822,300 shares changing hands.

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Author Author By KATRINA NICHOLAS
Date 08/09/1999

• The Perth Internet software developer raised 6
  million issuing 10 million shares at 60c each. A
  further 1 million was raised in
  oversubscriptions.
• However, Ms Caroline Egan, equity researcher with
  Commonwealth Securities, said that despite recent
  gains on Nasdaq, retail investors were beginning
  to shy away from local Internet stocks.
• There really wasn't much support from retail
  investors for HarvestRoad yesterday," Ms Egan
  said.
• It looks as though retail investors are
  switching out of Internet stocks and into biotech
  stocks. They are still looking for capital gain,
  but the Internet bubble has burst.
• She also said most buying and selling in
  HarvestRoad was from the float's joint
  underwriters, Falkiners Stockbroking and ELC
  Baillieu Stockbroking..
• Yesterday the recently listed eisa and Isis
  put in nondescript performances, with the former
  hitting an all-time low of 71c before recovering
  to close at 75c and the latter remaining steady
  at 62c. Isis raised 55 million while eisa raised
  57 million.

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Author Author By KATRINA NICHOLAS
Date 08/09/1999

• CPS Capital Group Managing Director Mr Tony
  Cunningham said HarvestRoad's better performance
  demonstrated that to avoid disgruntled
  shareholders stockbrokers must learn to price
  conservatively.
• The stock will be competing with a lot of other
  companies' stock and if you can make it cheap and
  attractive, you are going to win a lot of
  friends.
• But an adviser with Shaw Stockbroking,
  Mr Mal Webber, said predicting the performance
  of Internet stocks yet to list was still
  difficult. It's all in the eye of the beholder
  really," he said.

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Author Author By KATRINA NICHOLAS
Date 08/09/1999

• Some Internet stocks will fail and some will
  succeed it's all very arbitrary and defies a
  clean analytical approach."
• Associate director with William Noall Mr Peter
  Lyon said of the next two Internet companies to
  list, InvestorWeb was a better bet". Its float,
  which closed oversubscribed this week, raised
  10.23 million through an issue of 51.16 million
  shares at 20c each..
• The Melbourne-based company, which has more than
  26,400 registered customers and owns funds
  management group Investors Mutual, revealed a net
  profit after tax of 310,000 for the last
  financial year.
• This figure is expected to grow to 1.44 million
  this year and to 2.85 million next year.
• In contrast, Perth ISP iiNet is
  offering shares at 1 to raise 15.75 million.

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Author Author By KATRINA NICHOLAS
Date 08/09/1999

• I'd be more relaxed about InvestorWeb holding
  its price than iiNet," said Mr Lyon. For iiNet
  to be asking 1 is a big call."
• HarvestRoad
• Money raised
  7 million
• Issue price
  60c
• Close on first day
  60c
• Coming floats
• InvestorWeb
  10.2m Sept 30
• iiNet
  15.75m Sept 30
• Fairfax Online
  Undecided