SRK Capital: ImmuCell Corp ($ICCC) Investment Case

In their H1 2026 investor letter, SRK Capital provides an update on ImmuCell Corporation ($ICCC), a holding the firm believes is showing the earnings power of its core First Defense franchise after the company’s strategic exit from Re-Tain. SRK Fund I, LP returned 26.80% in the first half of 2026, compared with 10.18% for the S&P 500 and 22.57% for the Russell 2000. Portfolio manager Sean Kirkwood writes that he focuses on businesses trading at meaningful discounts to normalized cash flows, led by operators focused on controllable improvements. SRK states that even after the stock’s recent appreciation, ImmuCell remains a compelling opportunity.

Investment Highlight: ImmuCell Corporation ($ICCC)

Business Overview and the Re-Tain Exit

• ImmuCell’s core franchise is First Defense, which competes in the U.S. scours biologicals market
• SRK frames the investment around the company’s strategic exit from Re-Tain
• According to the letter, the Re-Tain development burden has been permanently removed
• The firm believes the exit is allowing the earnings power and cash-flow potential of First Defense to show through

First Quarter 2026 Results

• SRK describes the first quarter of 2026 as strong, with product sales up 28.4% year-over-year to $10.4 million
• The firm attributes the growth to higher volumes, price realization and an estimated three-point gain in U.S. scours biologicals market share
• According to the letter, gross margin expanded to 45.0% as increased production created operating leverage
• SRK notes net income rose 34% to $1.9 million

Capacity Expansion and Earnings Outlook

• SRK notes management is refitting the former Re-Tain facility to expand First Defense capacity beyond the current 450,000 units per month
• The firm believes this supports a path toward $35 million to $40 million of sales over the next 12 to 24 months
• With gross margins near 45%, SRK expects annual EBITDA can grow toward $12 million to $14 million
• According to the letter, that EBITDA can convert into free cash flow with limited corporate tax leakage for several years due to substantial net operating loss carryforwards
• The letter does not provide a specific price target or valuation multiple for the position

SRK Capital views ImmuCell as a business whose core First Defense franchise is showing its earnings power now that the Re-Tain development burden has been removed. The firm believes added capacity from the refitted Re-Tain facility can support $35 million to $40 million of sales and $12 million to $14 million of annual EBITDA, with NOL carryforwards limiting tax leakage on free cash flow. In SRK’s view, ImmuCell remains a compelling opportunity even after the stock’s recent appreciation.

Click here for the full Pro Investor Letter.