Shares digital

London-based foods group Conival (CVL:AIM) has launched a range of fresh chilled soups under its ‘Glorious!’ label. The new range, in partnership with celebrity chef Marco Pierre White, will initially be sold exclusively through Morrison supermarkets (MRW).

However, while the Marco Pierre White signature may help sales it is no guarantee of success in this fiercely competitive sector, which is dominated by Covent Garden and own label soups. Baxters tried to enter the sector using their well-known brand, and had to retreat. That underlines the challenge facing the company.

Although initial sales have been strong the brand has been heavily discounted – selling at £1.49 compared with the full price of £1.99 and Covent Garden’s £1.99. The real test of the brand is whether it can maintain progress when it goes onto full price this week and also secure listings in other supermarkets.

The launch of the Sparky smoothie last year was followed by competitive activity, which forced the company to reappraise the product. Similarly the Blenheim Palace range of desserts seems to have enjoyed only a limited success.

The company has warned that it will need to ‘review’ its funding requirements in the summer. It is debatable whether the company has the financial muscle to launch products on any scale.

The news of the launch has led to some interest in the shares (which have a one-month relative strength of 53%), however they remain a highly speculative investment.

Shares says: Investors should avoid the shares until there is greater clarity about the success of the launch and future funding needs. AVOID