Credit Intelligence rips higher as investors keep driving the fintech rally
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Shares in ASX fintech Credit Intelligence (ASX:CI1) led the market this morning, as the stock ripped higher by more than 50 per cent at the opening bell.
Those gains continued into midday trade, and a short time ago CI1 shares had climbed to around 9c — a gain of almost 100pc.
The price action is reflective of a surge in investor interest, with a number of other ASX fintech stocks also running red hot.
Shortly before 12pm EST, CI1 responded to an ASX price query to say it wasn’t aware of any market-moving information that would prompt such a surge.
Before rocketing higher in February, shares in CI1 had been climbing steadily since last December when the company announced the acquisition of a 60pc stake in fintech lender YOZO Finance for $1.38m in cash and scrip.
Developed by a research team at the University of Technology, Sydney (UTS), the YOZO platform provides a financial dashboard interface for SMEs to manage payments and cash flow.
The software also aims to leverage data insights and machine learning to provide rapid approval for automated BNPL solutions for business, based on payment frequencies and invoice sizes.
With its domestic fintech presence, CI1’s broader strategy is to diversify revenue streams across operations in Australia, Singapore and its core debt restructuring business in Hong Kong.
The Credit Intelligence rally follows similar outsized gains for ASX fintech stocks in recent weeks, led by IOUpay (ASX:IOU) which is pursuing a BNPL strategy in its core market of Malaysia.
IOU shares surged from a trading range of around 16c to 70c this week. This morning, the company announced a $50m share placement to institutional investors priced at 50c per share, which it said will anchor its expansion strategy across the south-east Asian region.
With interest rates locked in at rock-bottom for the foreseeable future, the recent price action is a sign that investors are staying on the lookout for the next round of high-growth tech names looking to disrupt traditional financial channels such as B2B lending.
And it’s a possible indicator that investors are increasingly looking to value businesses such as CI1 on the high-multiple basis that’s attributed to other big names such as Afterpay (ASX:APT) and Zip Co (ASX:Z1P).
The big BNPL names fell back yesterday after stringing together another round of strong gains, but the sector appeared to stabilise today with most stocks in the sector trading in positive territory during morning trade.
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