Next Investors logo grey

Cycliq enters US$2 billion Japanese bicycle market


Published 18-APR-2017 14:21 P.M.


2 minute read

Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.

In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.

The below articles were written under our previous business model. We have kept these articles online here for your reference.

Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.

Click Here to View Latest Articles

There has been a steady flow of positive news for Cycliq Group (ASX:CYQ) over the last fortnight with the company expanding its Australian and global reach through distribution agreements, as well as launching an online sale portal for Australian bike dealers.

While this has resulted in its share price bouncing approximately 10%, it appears to be off an oversold base, suggesting news released today that it has launched its cycling accessory products on Amazon Japan could provide further momentum.

As a backdrop, CYQ is the number one brand in high definition camera and lighting combinations, delivering cycling safety and action camera solutions for commuters, mountain bikers, racers and professional cyclists alike.

Japan is an important market for the company, as a report released in 2016 by Global Industry Analysts valued the bicycle industry in that country at US$1.95 billion.

The same report predicts the annual market for parts and accessories will grow to US$408 million by 2022. This is well supported by data regarding bicycle usage in Japan where 78% of the population owns a bike.

Looking specifically at CYQ’s range, management expects strong demand for its Fly6 and Fly12 products, all in one safety lights and high definition cameras as illustrated below.

By law, cyclists in Japan must be equipped with a front light which needs to be turned on at night.

Commenting on this recent development and the importance of penetrating the Japanese market, CYQ’s Chairman Chris Singleton said, “Cycling is a big part of the culture and people are technology oriented, which makes it the ideal place to sell our products”.

Importantly, Amazon Japan is accessible to consumers throughout Asia and offers reduced shipping rates to homes and businesses in mainland China, Macau, Hong Kong, Taiwan and South Korea, regions where per capita bicycle usage is comparatively high.

Singleton highlighted the fact that the company’s high definition cameras have about 10 hours of battery life making them the best performing action cameras on the market.

Upcoming milestones that have the potential to provide further share price momentum are as follows.

General Information Only

S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (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 and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

Conflicts of Interest Notice

S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.

Publication Notice and Disclaimer

The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.

Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.

This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.