1. OncoSil Medical Limited (Recommendation: Speculative Buy, Market Cap: $87.0 Mn)

Significant Progress in Commercialisation: OncoSil Medical Limited (ASX: OSL) is primarily engaged in the development of its lead product candidate, the OncoSil™ localised radiation therapy for the treatment of pancreatic cancer. The below section provides an overview of the latest operational and financial performance of OSL:

• During the quarter ended 30^th June 2020, the company achieved CE Mark in April 2020 and progressed critical launch preparation activities in Europe for the treatment of locally advanced pancreatic cancer (LAPC). In ASEAN / APAC, regulatory approvals were received in Singapore and New Zealand for LAPC. In July 2020, the company filed the Humanitarian Device Exemption (HDE) application with the FDA in July 2020 for the treatment of bile duct cancer in the US.
• Debt Scenario: As on 31st December 2019, the company had total debt of $0.23 million, with cash and short-term investments of $6.80 million.
• Overview of Financials/Fundamentals: In 1HFY20, the company had a current ratio of 7.3x, as compared to the industry median of 4.03x. Assets/equity ratio for the half stood at 1.16x and debt/equity ratio stood at 0.03x. It represents decent balance sheet position of the company as at 31 December 2019. 

A Pictorial Presentation of Key Financials:

SWOT Analysis:

Stock Recommendation:

• The stock of the company gave positive returns of 67.33% in the last one year and is currently inclined towards its 52-week low of $0.056 and has immediate support at ~$0.099 and resistance around $0.121 level (on technical analysis front).
• The company has raised $19 million via capital raising, which will support commercialisation activities across Europe, UK, ASEAN, and APAC for LAPC and in the US for bile duct cancer.
• Key Risks: Delay in Launch Plans; Increased Competition; Liquidity Risk.
• Considering the progress on commercialisation activities, capital raising, key risks, and current trading levels, we give a “Speculative Buy” recommendation on the stock at the current market price of $0.105 on 14^th August 2020.

2. Adveritas Limited (Recommendation: Speculative Buy, Market Cap: $33.64 Mn)

Robust Foundation for Growth: Adveritas Limited (ASX: AV1) is engaged in the provision of comprehensive digital advertising fraud prevention services through its SaaS product, TrafficGuard®, which was commercially launched on 1^st July 2018. The below section provides a quick overview of the business:

• In FY19 ended 30^th June 2020, the company expanded TrafficGuard’s addressable market from mobile to desktop advertising and launched Pay Per Click protection for Google Ads campaigns. The above milestones laid the foundation for rapid revenue growth for FY20.
• During the June 2020 quarter, the company launched its Freemium offering, which attracted a high level of interest for its TrafficGuard’s Google Pay Per Click offering. The quarter witnessed strong initial conversions of Freemium subscribers to paying customers. As of 31^st July 2020, the company had over 40 paying clients for its services.
• Debt Scenario: As on 31^st December 2019, the company had cash and short-term investments amounting to $3.06 million and total debt of $0.67 million.
• Overview of Financials/Fundamentals: Current ratio for the first half stood at 2.79x, as compared to the industry median of 1.82x. As on 30^th June 2020, the company had a robust balance sheet with $8.351 million in cash.

A Pictorial Presentation of Key Financials:

SWOT Analysis:

Stock Recommendation:

• The stock of the company gave positive returns of 22.09% in the last three months and is currently inclined towards its 52-week low of $0.065 and has immediate support at ~$0.076 and resistance around $0.140 level (on technical analysis front).
• The company has a growing pipeline of opportunities which can be converted into substantial revenues, with the right marketing efforts. A robust balance sheet boosts the reliability on AV1’s financial well-being.
• Key Risks: Credit Risk; Loss Making; COVID-19 Disruptions.
• Considering the performance in the June quarter, growth opportunities, continuous shift towards diversification, expansion plans, key risks, and current trading levels, we give a “Speculative Buy” recommendation on the stock at the current market price of $0.115, up 9.524% on 14^th August 2020.

3. 8common Limited (Recommendation: Speculative Buy, Market Cap: $12.8 Mn)

Positive Cashflow Despite COVID-19: 8common Limited (ASX: 8CO) is primarily engaged in the development and distribution of two established software solutions, Expense8 and Perform8, which help clients, their employees, and professionals to control costs and boost productivity. In FY19, the company reported another strong year of operations, with significant new contract wins. Revenue from continuing operations increased by 32% to $3.47 million.

• During the quarter ended 30^th June 2020, the company generated $46k of operating cashflows, driven by cash receipts of $1.3 million.
• Debt Scenario: As on 31st December 2019, the company had zero debt, with cash and short-term investments of $0.93 million. Net cash position as on 30^th June 2020 stood at $1.8 million.
• Overview of Financials/Fundamentals: Revenue for FY20 increased by 8% and stood at $3.7 million. Total SaaS revenue for the year increased by 30% and came in at $2.5 million. During 1HFY20, the company had a gross margin of 88.9%, higher than the pcp margin of 80%.

A Pictorial Presentation of Key Financials:

SWOT Analysis:

Stock Recommendation:

• The stock of the company gave positive returns of 32.08% in the last three months and is currently inclined towards its 52-week low of $0.045 and has immediate support at $0.056 and resistance around $0.078 level (on technical analysis front).
• The company has a robust profile of increasing SaaS revenues, which is expected to drive future performance.
• On a trailing twelve months (TTM) basis, the stock has an EV/Sales multiple of 3.4x, as compared to the industry median (Software & IT Services) of 6.3x.
• Key Risks: COVID-19 Impact; Risk of Delay in Contract Delivery; Competition Risk
• Considering the performance in the June quarter, new contract wins, continuous investment in product development, key risks, and current trading levels, we give a “Speculative Buy” recommendation on the stock at the current market price of $0.065, down 7.143% on 14^th August 2020.

Comparative Price Chart (Source: Refinitiv, Thomson Reuters)

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