The Tali Digital Ltd (ASX: TD1) share price is surging by nearly 30% today, after the company announced it has signed an investment and advertising agreement with the Times Group of India. At the time of writing, the Tali Digital share price is trading at 4.8 cents after closing its previous session at 3.7 cents.
What’s driving the Tali Digital share price?
The Tali Digital share price is rocketing higher after the digital health company advised the new agreement was signed with Brand Capital International (BCI), which is part of the Times Group of India.
Under the investment agreement, BCI will make an initial investment of US$2 million into Tali. This will see BCI receiving 81.8 million shares in Tali at 3.3 cents per share, representing 9.8% of the company.
There is also a clause for additional investments by BCI of up to $US5 million, which will be at the mutual agreement of both parties.
The advertising agreement, meanwhile, will see The Times Group of India become Tali’s channel partner in promoting the sales of its ‘Tali Detect’ and ‘Tali Train’ cognitive performance tools into India.
Funds from the initial investment will be utilised for the advertisement agreement with The Times Group, which will provide Tali access to 550 million people every month.
Big potential in India
Tali says the Indian market represents a significant growth opportunity for the company.
Almost one in eight children in India between the ages of 2 and 9 years are estimated to have at least one neuro-developmental disorder. This represents a direct opportunity for Tali to target its products to a market of approximately 30 million children.
India also possesses the world’s second largest middle-class population with approximately 340 million people, and is set to surpass China in size by 2035.
The Tali Detect and Tali Train cognitive performance tools have already been launched in India via the iOS and Android app stores in October 2020.
Today’s agreement with the Times Group will provide a platform for these products to be directly marketed to the Indian consumer via the Times Group’s 360-degree media assets, which include popular print, television, radio and digital channels in India.
Tali Digital managing director Glenn Smith said that India provides a significant growth opportunity for the company.
We are pleased to be partnering with Brand Capital International in the Indian market. This deal will provide significant exposure possible in growing the Indian market opportunity for Tali.
What are ‘Tali Detect’ and ‘Tali Train’?
Tali Detect and Tali Train are digital tools to help children with attention and learning difficulties.
The technology combines 25 years of research in developmental psychology and cognitive neuroscience to deliver game-based digital programs to assess and strengthen attention capabilities early in life.
In developing these products, Tali has leveraged research from one of Australia’s leading neuroscience institutes – the Monash Institute of Cognitive and Clinical Neurosciences – to build algorithms that produce reports for parents, teachers and healthcare partners.
About the Tali Digital share price
In October, Tali made an announcement reporting its products had been clinically validated, and had achieved regulatory clearance in the United States and the European Union.
The company advised that commercialisation of its products would be executed throughout the remainder of FY21.
The Tali Digital share price has made grounds since losing 70% of its value in March, at the height of the pandemic. After today’s rise, Tali shares are now almost back at the same level at which they began 2020.
The company commands a market capitalisation of around $28 million.
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More reading
- Why the Tali Digital (ASX: TD1) share price has rocketed 40% today
Motley Fool contributor Eddy Sunarto has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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