Keynes once said that “the market can remain irrational longer than you can remain solvent”. Fundamentals departed market valuation long ago, but you could’ve at least expected market reaction to be in response to COVID-19 related news. Except it seems like that’s no longer the case. So the question is – where should the money go?
At this point, the smart money in equities is moving across two broad brushstrokes – commodities and value bets. These value bets are placed either largely on tech (long on growth/ margins), or healthcare (pandemic). In small-caps, the combination of both is Predictmedix (PMED.C).
The reopening of the US economy may not be as grand as investors may have hoped as the number of new COVID-19 cases hit a record number in the US, eclipsing the rates seen during April. Texas has halted its plans of reopening, shutting down all bars, and scaling down restaurant operations. For markets and the global economy, it means the fight against COVID-19 is very much alive until there is a vaccine or a cure.
Until then, we’re all set to get airsick in choppy weather, until we start deploying capital where it needs to be deployed – towards strategic investments that aid our fight against a pandemic. Enter: PredictMedix.
The stock has performed relatively well year to date despite skeptics being assured that this was a classic “pump-and-dump” moment where the last laugh would be theirs as they’d claim “Ha – sucker.” Unfortunately for them, the firm has been able to maintain a steady newsflow of strategic hiring, partnerships, acquisitions, and deployment of technologies.
This morning, the firm announced another milestone – a strategic collaboration with Tech Mahindra Ltd, a leading provider of digital transformation, that offers AI-based healthcare solutions as part of a suite of post-COVID-19 technology.
Tech Mahindra is a giant in the Indian markets and brought in $5.2 billion USD in revenue last year. With 125,000+ employees across 90 countries, Tech Mahindra does digital transformations across pretty much all sectors. The past year, it managed to maintain a steady flow of revenue and margins.
TechMahindra operates internationally, and in Canada, it deployed its digital solution suite to help Scotiabank reach customers.
COVID-19 has been a splash of cold water, making us aware of the fragility of our economy and its sensitivity to shocks. A post COVID world is still a few weeks (read: months) away, but when that day comes, workplace safety is going to become a major theme.
TechMahindra has launched TechM NxT in 2018 and is currently launching its existing suite of technologies to help companies across the globe tackle the impact of the pandemic. With PredictMedix, TechMahindra will have an additional suite of technology it would be able to offer clients in different healthcare verticals to tackle issues of:
- Impairment detection
- Mental Illnesses
- Infectious disease diagnostics
In business-speak, a win-win.
Given that TechMahindra already operates in digital transformations, a bet on PredictMedix is essentially a bet on AI. And as I wrote earlier, the great thing about technology is that it is scaleable.
PredictMedix’s AI tool essentially screens large sets of data for some screening criteria (symptoms etc.). The more data sets the software screens, the better it becomes at screening form those specific criteria. That’s the gist of AI.
But business is as much about the people as much it is about the technology, and the great thing about PredictMedix’s partnership with Tech Mahindra is that it is a partnership with the people at PredictMedix.
The board of PMED is accomplished and diverse, and also happens to run another AI company – Deepspatial AI, that uses AI technologies across other industry verticals. In the long run, PMED’s partnership with Tech Mahindra allows this junior biotech firm to expand its reach and solution suite across industry verticals beyond just healthcare. Incentives could not be more clearly aligned.
For the skeptics who think healthcare is dead because COVID-19 is old news, the reminder is that the number of new infections in the US jumped on Tuesday more than it had over the past month.
And if you needed proof, White House health advisor Dr. Anthony Fauci said Tuesday that parts of the U.S. are beginning to see a “disturbing surge” in coronavirus infections.
While PMED’s technology is being deployed to help the world fight the battle against COVID-19, a partnership with TechMahindra means PredicMedix’s technology has the potential to be used for a lot more in the future.
Given TechMahindra’s existing partnerships across industry verticals, the addition of Predictmedix’s tech to the product suite is a testament to both, the company, and the range of problems in healthcare that can be solved with AI.
Full Disclosure: PredictMedix is an EquityGuru marketing client, and the firm owns stock in the company.