Hi. Adding my two penny bit again 
I don’t think one can look at certifications and approvals as a moat. These are requirements as part of a bidding or regulatory process which most companies in the sector will have or need to get in order to compete and sell effectively.
Think of it this way – Pharma companies wanting to sell in the US market need to have in place USFDA approvals, this does not mean that they have a moat, or that these approvals can act as a moat.
‘Moats’ in my much uninformed opinion is a term that is being over used today – it is important yes, but more so in a commoditized sector/ industry, think Kitex/ ACM?
In this particular business the investment rationale/ decision has to be based more on the size of opportunity, the positioning of the company in relation to the opportunity and how management is looking exploit the opportunity in the years ahead; in terms of launching new products, looking to drive scale in manufacturing and distribution, entry into new markets and marketing efforts (of which these approvals are a part) etc.
Whether or not current price reflects value is something I reserve my opinion on.
Disc: Invested
| Subscribe To Our Free Newsletter |
