Some leading ASX growth shares could be worth considering in April 2022.
There has been significant volatility on the ASX share market since the start of the year. But sometimes, the ups and downs of the stock market can open up opportunities.
With that in mind, here are two possible contenders that have compelling growth potential:
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Bailador Technology Investments Ltd (ASX: BTI)
Bailador describes itself as a technology expansion capital fund. It says it provides investors with exposure to "expansion-stage" technology companies at attractive valuations before going public and listing on a stock exchange.
Some of its previous investments have been Lendi, Siteminder Ltd (ASX: SDR), and Straker Translations Ltd (ASX: STG).
The Bailador share price has fallen by almost 20% since the start of the year. But the company can point to several financial metrics that show the strength of the underlying businesses.
In December 2021, the ASX growth share had 10 investments which had 43% revenue growth for the 12 months to December 2021, or 81% revenue growth excluding travel. Around 91% of the revenue is recurring. Those investments had a gross profit margin of about 66%.
Despite the pain that technology businesses have experienced on the share market, Bailador has continued to report gains.
It has entered into an agreement to sell its investment in Standard Media Index for $20 million, representing an uplift of approximately 67% to the carrying value. This valuation uplift represented an $8 million increase.
Bailador also recently completed an additional $7.7 million investment in InstantScripts, a digital healthcare platform that enables Australians to conveniently access high-quality doctor care and routine prescription medication. It saw 109% revenue growth in the three months to January 2022. The valuation of the investment round resulted in a 15% uplift to the valuation of Bailador's existing investment in InstantScripts.
Bubs Australia Ltd (ASX: BUB)
Bubs is an Australian infant formula business that specialises in goat milk products. The company claims to be the fastest-growing infant formula manufacturer in Australia.
In its recent FY22 half-year result, it reported several achievements. It said that it achieved positive earnings before interest, tax, depreciation and amortisation (EBITDA) for the first time, with positive cash flow in the half (and both quarters being cash flow positive).
It doubled its infant formula sales, which helped "significant" gross profit margin improvement. Bubs saw "strong" growth in domestic retail scan sales with market share gains. Corporate daigou sales were also at a record high.
The ASX growth share has also launched 'Bubs Supreme' featuring A2 beta-casein protein milk, with ranging secured in 500 Coles Group Ltd (ASX: COL) supermarkets nationally. It will be on the shelves from May 2022.
Corporate daigou partner Willis Trading has made an opening purchase order of $32.9 million. This will be delivered in the fourth quarter of FY22 and the first quarter of FY23.
Bubs boasts that it now has a presence across all key premium segments: goat, organic, and A2 beta-casein protein.
