ECMOHO Limited (MOHO) stock was declining in the intraday trading session after announcing the pricing of an underwritten public offering of American Depository Shares(ADSs). MOHO stock price saw a downtrend of 36.38% to drop at $0.84 a share at the time of this writing. The trading volume was 2,382,516 on the last check. Let’s have a deep look at this stock.
Underwritten Public Offering:
ECMOHO Limited is an investment holding company that provides integrated solutions to the non-medical health and wellness market. Today it announced the pricing of 10 million ADSs at a price of $0.90 per ADS. The offering would result in the gross proceeds of $9.0 million without deducting underwriter discounts, and other offering-related expenses. One thing is to note that these gross proceeds estimate does not include any additional purchase of ADSs. One American Depositor Share represents four Class A ordinary shares of the MOHO stock. ECMOHO is planning to invest part of the net proceeds in its SaaS platform. MOHO stock will use remaining amount for working capital as well as general corporate purposes. The offering will be expected to end on August 5, 2021, after the satisfaction of customary closing conditions.
MOHO stock granted a 45-day option to the underwriter to purchase up to 12.8% of the number of ADSs in the public offering in order to cover over-allotments. Exercising the full option will increase the gross proceeds from $9.0 million to approximately $10.2 million.
Previous Activities of MOHO stock:
MOHO stock on July 16, 2021, entered into the strategic cooperation agreement with Chong Kundang Group. The purpose of this agreement is to provide marketing services and sales of Chong Kundang’s health products in China. The agreement would benefit both companies in terms of their growth.
ECMOHO stock empowered many brands through its ECMOHO 618 sales event, held on June 18, 2021. Many top domestic, as well as foreign brands, participated in this event. Moreover, consumer data was gathered for the efficient future marketing and advertisement of health care products.
Wrap Up:
The announcement of pricing of underwritten public offering is the obvious reason for the bearish sentiment. The MOHO stock expects to announce its second-quarter 2021 financial results in the mid of next month. It is better to do both fundamental as well as technical analysis before adding this stock to the portfolio.
