Despite risk and liquidity issues, small companies offer the most impressive potential gains, particularly if the business has compelling strategic value.

One such company is Preston-based Plant Impact (launched last year at 38p and now 51.5p), a play on growing calls for greener processes and greater productivity in agriculture.

Chief executive Peter Blezard insists his company is pioneering in ‘plant stress relief management’, having developed a range of ecologically sound crop nutrients and natural pesticides that improve crop health and productivity. His ambition is to ‘transform agriculture’ and take the uncertainty out of farming by reducing plant stress caused by excess heat and cold, drought, salinity, pest and disease.

Stress less

Stress reduction leads to greater marketable yields, greater profits for growers and superior food for consumers. The group’s technology can make previously uncultivable land usable and control mites and insects, as well as accelerate harvests and improve the quality, shelf life and yield of perishables, fruit and flowers included.

If defensive stocks are your preferred option in today’s tempestuous markets, look elsewhere, because Plant Impact is blue sky, having lost £1.9 million on modest sales of £377,000 last year to March. However, sales are developing well in the Middle East, the US and the EU, and Plant Impact has bagged early sales in the home and garden sector, through a white-label product with Sir Terry Leahy’s Tesco no less. Product field trials are also being conducted by a glut of global agricultural chemicals giants and I sense that distribution and licensing deals are afoot.

Plant Impact, whose short-term prospects are underpinned by £3.1 million of year-end cash, is worth stashing away. If you can stand the inherent risk, join Gartmore and YFM Private Equity as a backer of the business.

Brown buoys Bioganix

‘Gordon Brown’s latest landfill tax rise was music to our ears,’ enthuses Nick Helme, chief executive of waste management services minnow Bioganix, already feeling the positive gate fee effect for the types of wastes processed at its first two plants in Herefordshire and Suffolk.

Brought to market in April 2006 at 120p, the group’s share price has clipped higher to 142.5p in anticipation of the huge growth opportunities arising from the increasing costs of disposing of waste through landfill sites as well as the growing layers of environmental red tape governing this industry. Bioganix’s innovative ‘in-vessel’ composting technology is particularly adept at treating waste governed by the Animal By-Products Regulations and local authority organic wastes, turning them into nutrient-rich compost.

The technology offers faster conversion rates and superior odour management abilities compared with rivals in the sector, qualities that should help the group secure deals in the offing with local authorities and potential waste industry clients.

With a shade over £3 million raised at float, Helme recently managed to prise a further £2.25 million from the City to part-finance construction of a third composting plant to be built at Sharpness in Gloucestershire (a location with strategic proximity to a number of local authorities).

Maiden AIM financials were encouraging at the top line, with turnover up 130 per cent to £1.6 million on the back of gate fee and tonnage increases in Herefordshire and Suffolk and Bioganix just below break-even at the bottom line level.

Well established, claiming technological superiority and in talks on a variety of local authority tenders, a move into pre-tax profit is forecast for 2008. In my opinion, the company promises a lucrative future as an independent and could even prove a premium-priced target for the sector’s big boys