These Israeli tech stocks are winning the market-disruption game, part 2

Published at Jan 24, 2019, in Features

Yesterday, we outlined five ASX-listed Israeli tech stocks that are standing out. Here's another five to keep an eye on.

MGC Pharmaceuticals

Market cap: $49.7M

Biotech-focused pot-stock, MGC Pharma, is cultivating a seamless global supply chain from planting to extraction, with a focus on innovating pharma-grade medicinal marijuana products to improve the lives of patients across the world.

MGC’s founders are all trailblazers in the phytocannabinoid space hailing from the industry-leading Israeli medicinal marijuana scene.

The company already has a wide-reaching global footprint with facilities and research across Australia, Slovenia, Malta, the Czech Republic, with plans to expand into the Asian, UK, and North America markets.

MGC’s first medicinal product offering, CannEpil, is now available for supply in Australia through specialist prescribers under the Authorised Prescriber Scheme (APS), following its first importation from the company’s GMP certified European manufacturing facility in December last year.

CannEpil is an orally administered medical cannabis treatment for drug-resistant or refractory epilepsy, which accounts for about 30% all cases. The product has undergone years of rigorous testing and now it’s been green-lit by the TGA.

MGC Pharma's CannEpil product for treatment of drug-resistant epilepsy

MGC has also received approval to initiate its Phase IIB clinical trial on dementia and Alzheimer patients with UNDA in WA, and start the recruitment, using its second GMP-certified IMP (investigative medicinal product), CogniCann.

On top of that, it also revealed this week that it’s received government approval for API extraction at it European facility — meaning MGC can now develop its own THC (tetrahydrocannabinol), CBD (cannabidiol) and other phytocannabinoids as APIs for the formulation of CogniCann and other future phytomedicines.

Elsight (ASX:ELS)

Market cap: $61.3M

Elsight is a mobile security and surveillance solutions provider whose mission, in its own words, is “to create a seamless, secure, connected world.”

Elsight was birthed in 2009 by Nir Gabay and Roee Kashi, both of whom come from the Israeli special forces and military intelligence.

The company develops cutting-edge technology that delivers secure, real-time, adaptive data transmission over multiple IP links, allowing high-bandwidth, on-the-move connectivity anytime, anywhere.

Here’s the crux of what ELS does:

From secure connectivity for emergency medical services (EMS) and first responders to real-time data transfer for autonomous vehicles, fleet management and drones, Elsight’s range of end-to-end data transmission applications offer high level of reliability, lowest latency, and highest adaptive bandwidth over cellular networks.

This technology has been developed into a range of products, including portable devices, vehicle mounted and fixed/wall mounted devices for use for secured datalink in tactical security and surveillance situations, with potential for additional applications.

The tech is being used by first responder and homeland security services in Israel including SWAT and special forces teams, Israeli police services, Israeli emergency services, and military and defence services.

eSense-Lab (ASX:ESE)

Market cap: $3.4M

eSense-Lab is a life sciences research and development company creating natural plant-based products that “heal and delight”. It’s a pot-stock operating in the e-liquids and vaping tech space, with a focus on creating on “virtual plants”.

Headquartered in Israel, the company combines genetics, mRNA, protein expression and phytochemical profiles to generate a comprehensive model of rare or high value plants.

With multi-disciplinary R&D expertise, unique reverse engineering capabilities, and game-changing techniques that enable re-engineering the chemical composition found in plants, ESE re-formulates these for several commercial applications.

Cannabis is the first plant the company is targeting— it’s creating a pot plant that has all the characteristics of the real thing, but doesn’t actually contain the psychoactive and more heavily regulated cannabinoid compound.

ESE has clinched a e commercial supply agreement with E-Quits Group – one of the largest companies operating in the UK e-liquid market. ESE’s terpene blends comprise a critical component in E-Quit’s final product and contains a mixture of ingredients, including CBD infused with its Super Lemon Haze terpene blend.

E-Quits has made a significant investment in marketing this product with positive response from customers — feedback that’s based on remarkable results experienced in the alleviation of anxiety, depression, pain (back injuries and arthritis) and severe epileptic seizures.

Dragontail Systems (ASX:DTS)

Market cap: $43.4M

Dragontail is looking to revolutionise the quick service restaurant (QSR) and food service industry — a market that’s worth over $400 billion globally with over $250 billion in North America alone.

It’s doing this with its Algo System and computer-vision QT quality system that uses AI machine learning.

The Algo System uses a sophisticated patented algorithm to optimise and manage the entire food preparation process from order to delivery. While current technologies only focus on driver dispatch and tracking, Algo is the first system to fully automate and streamline the kitchen flow to deliver an immediate and significant return on investment to fast food and quick service restaurants.

The QT system’s sensor and camera automatically monitor the preparation and cooking process to improve the quality and consistency of meals. Using advanced machine learning technology, the system keeps improving its diagnostics, becoming even more efficient.

The Algo is already installed in Israel, Canada Singapore and the US, and generating revenue from monthly licensing fees. The company forecasts it will have 3,330 contracted stores and approximately 1,700 installed by Q2 2019.

Dragontail’s customers include Pizza Hut in Australia, Israel, Canada and Cyprus, KFC in Asia, Cara Operations in Canada, and Domino's Pizza.

Fluence Corporation (ASX:FLC)

Market cap: $201.5M

Bringing together breakthrough water treatment technologies and proven delivery platforms to optimise the water cycle for the 21st century, Fluence pitches itself as the global leader in the delivery of innovative, cost-effective, decentralised water, wastewater, and reuse solutions for businesses and communities anywhere in the world.

Given that water shortages currently affect 2.7 billion people, and that global water consumption is set to double by 2050, FLC is addressing a clear, real-world set of problems.

The small cap offers an integrated range of services across the entire water cycle, from early-stage evaluation, through design and delivery, to ongoing support and optimisation of water-related assets.

Fluence’s NIROBOXTM SW product — a modular, high-output, membrane-based and efficient seawater desalination solution

With headquarters in New York, Fluence has a global staff of 300 water professionals, more than 7,000 references in 70 countries, and decades of expertise delivering sustainable solutions for municipal, industrial, and commercial clients across the globe.

Fluence has core operations in North America, South America, the Middle East, and Europe, and is now looking to expand into the ample Chinese market for rural wastewater treatment.

Its customers include the likes of Coca-Cola, Stanford University, Water Fleet, Procter & Gamble, and Cargill.

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S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.

Conflict of Interest Notice

S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.

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