Nasstar

Hosted desktop specialist Nasstar (NASA) has narrowed losses in the year to September, and is starting to gain increasing traction.

A trading update in October revealed the AIM counter was on track for a 25% spurt in desktop subscribers to 2,000. This has been duly delivered, but since the period end it has surged another 15% to 2,300, and today it has secured an additional contract for over 100 to provide its desktop product for barristers' chambers.

The cloud computing concept is a way of delivering any service over the internet. Spanning both consumer facing and business services, it encompasses Facebook and Twitter when used as apps that are hosted, or Apple's iCloud which enables individuals to store pictures and music. So the switch to business use is a natural progression.

Nasstar can help clients save money, moreover it brings increasing flexibility to the workforce. Since formation in 1998, it has been working hard to continually upgrade its products, so has been investing in technology and technical staff. Though sales in the year just ended were broadly flat at £2.3m, it more than halved its losses to £140,000 (2010: £302,000).

Earlier this year Nasstar raised £1.2m in a placing at 8p a share, this brought in savvy institutional investors Close Brothers, Octopus and Kestrel. The Old Street based firm reckons the current financial year should show good growth, indeed the expectation is for a swing to the black. With no requirement to raise further funds, Nasstar is an attractive investment in a market where cloud adoption is on the increase. Buy.