Investors looking for deep-value opportunities should note that shares in online premium whisky purveyor Artisanal Spirits (ART:AIM) trade at a material discount to the value of its maturing stock of Scotch whisky.

As Equity Development notes, this inventory has an estimated value of £430 million, more than 10 times Artisanal Spirits’ £40 million market capitalisation at 57.15p a share. A curator and provider of premium single cask Scotch malt whisky for sale mainly online to a global membership, Artisanal serves up first-half results on 14 September.

It has already pre-announced 25% sales growth to knocking on £10 million, including what management dubbed a ‘standout’ performance in China, as well as a 24% advance in its Scotch Malt Whisky Society membership to over 35,500. Artisanal Spirits’ management also reiterated its ambition to double sales between full year 2020’s £15 million to £30 million by 2024.

Equity Development argues fair value for the shares is 150p, implying 162% upside at these levels. It says Artisanal Spirit’s ownership of ‘an abundant supply of maturing whisky stock should ensure that the company is capable of meeting the growth in demand for its products. The company is both hedged against inflation and insulated from any risks associated with supply chain disruption.’

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