@ mylesmankuah, I am also increasing my Vmoto holding (in my RL portfolio) and likewise I am very interested in exploring the bear case. I can think of a few potential risks, but there could be others I'm overlooking.

1. Competition risks:

There are many companies that design and manufacture two wheel electric vehicles. Does Vmoto have an edge? Who will be the winner? I searched some reviews on electric mopeds. In a review of the 10 best electric mopeds in the UK, Brett Tinkley from BikeMatters included two Vmoto models, the Super Soco CPx came in second behind the NIU NQiGTS Pro despite the Super Soco CPx having more power (4 kw compared to 3kw) and a higher top speed (55 mph compared to 45 mph).

Comments about the Super Soco CPx incuded: “A fantastic spec make the CPx a truly great electric scooter, pushing the boundaries even further and gaining on the performance of a combustion engine. The CPx is a great all-round option, with decent modern looks, good top speed, great range and respectable charge time - oh and a price tag of £3,599. The CPx had a successful year in 2020 and I can see it repeating itself in 2021.” 

2. Sovereign risks

The risks associated with an Australian company operating in China under the increasing political tensions between the two countries. The communist government has the power to cripple a company if they choose to. This is evident by what is playing out with wine, barley, timber etc.

3. Management Risks

I don’t know a lot about the management and if they have a history of acting in the best  interests of shareholders. The Managing Director Charles Chen is an Ex-Honda Sundiro executive with 28 years experience in motorcycle manufacturing, international sales marketing, R&D, procurement and production. He Graduated from Wuhan University (Bachelor of Automobile Engineering) and South Wales University (postgraduate Diploma of Business Administration). Credentials of the other Board members are included in the Annual General Meeting Presentation.

Most of the directors have skin in the game. The MD owns 8% of the company.

There has been some recent insider buying with Non-Executive Director, Blair Sergeant buying 90,000 shares @ 37c on 13 May. This represents over 3 times Blair Sergeant’s Board fees.

4. Balance Sheet risks

There are none at present. Vmoto have a strong cash position of A$15.8 million, with no bank debt as at 31 March 2021.

5.  COVID Risks

 Vmoto is closely monitoring the developments of Covid-19 and remains well-prepared, should the implementation of a revised strategy be required. Vmoto is confident in the strength of its global growth strategy and expects similar levels of growth to be delivered for the 2021 financial year