Atomo Diagnostics Ltd. (ASX: AT1)

AT1 is an Australian company involved in the development and sales of diagnostic medical devices including Rapid Diagnostic Test (RDT) platform to test for HIV, rapid antibody and antigens. Its market capitalization stood at AUD 173.42 million as of 28^thOctober 2021.

Financial and Operational Updates:  On 28^th October 2021, SG Hiscock & Company Limited ceased to be a substantial holder in the company. As per the release on 26^th October 2021, AT1 revamped its supply and advertising condition for HIV Self-Test following the approval by regulatory body. In its Quarterly Activities Report (1QFY22) released on 25^th October 2021 it was mentioned, sales from Antigen tests increased and AT1 has entered in a new agreement with Access Bio. The cash receipts and un-audited revenue for the quarter were reported as ~AUD 2.2 million and ~AUD 2.4 million, respectively. As per the release of Annual Report to Shareholders for FY21 on 5^th October 2021, it showed an increase in revenue from continuing operations and reported as ~AUD 6.72 million for FY21 as against ~AUD 5.37 million in FY20. It reduced its Net Losses after Income Tax of ~AUD 9.21 million in FY20 to ~AUD 6.02 million in FY21. Cash at the end of FY21 was reported as ~AUD 17.94 million as of 30^th June 2021 versus ~AUD 27.10 million in PcP. On 5^th October 2021, it renegotiated the agreement with Access Bio LLC, where Atomo will receive one-off fee against the payment due in the existing agreement, along with the right to purchase COVID-19 Rapid Antigen tests (Atomo Branded) at a fixed price per unit upto 10 million units, for now and CY22 in Australia and NZ. On 16^th September 2021, Ellerston Capital Limited (Primary Person) and its associates changed its substantial shareholding from ~6.13% to ~7.31%. On 14^th September 2021, SG Hiscock & Company Limited became substantial shareholder in AT1.

Technical Analysis: On the weekly chart, AT1 stock price witnessed a breakout of an ascending triangle pattern at AUD 0.31 level and sustaining below the same. However, the prices are trading below the trend-following indicators 21-period SMA and 50-period SMA, which may act as a crucial support level. The momentum oscillator RSI (14-period) is trading at ~55.82 and showing negative sign which indicate the possibility of a correction from the lower levels. An important support level for the stock, is placed at AUD 0.22 while the key resistance level is placed at AUD 0.35.

The risk attached in investing in the scrip when a correction is expected should be taken in consideration with a cautious approach, hence a ‘Watch’ stance is suggested. The stock was analysed as per the closing price of AUD 0.310 per share, up by ~1.639%, as of 28^th October 2021.

Weekly Technical Chart – AT1

Source: REFINITIV

Balkan Mining and Minerals Limited (ASX: BMM)

BMM is a newly incorporated Australian company focussed on exploration and development of lithium and borated in the Serbia region. Its projects are Rekovac Project, Dobrinja Project and Pranjani Project. Its market capitalization stood at AUD 30.22 million as of 28^th October 2021.

Financial & Operational Updates: As per the announcement on 11th October 2021, the company commenced drilling program at Rekovac Lithium-Borate Project. As per Corporate Presentation released on 7th October 2021, cash at the end of 31st July 2021, stood out as AUD 6.5 million (excluding IPO costs and Jadar Loan). On 6th October 2021, 97 outcrops from extensive surface prospecting and 61 samples of lacustrine-appearing sediments from geochemical analysis were collected at Dobrinja Lithium-Borate Project. As per the Annual Report for 2021, its net loss for the FY21 decreased and reached ~AUD 0.44 million versus loss of ~AUD 0.68 million reported last year. The company’s cash and cash equivalents status decreased substantially, from ~AUD 39.97k as of 30th June 2020 to ~AUD 1.15k as of 30th June 2021, owing to substantial payment made to suppliers and employees.

Technical Analysis: After making a high at AUD 0.94 in September since its IPO in July, it has been in a consolidation phase and trading at near a horizontal trend line of support at ~0.66. On a daily chart, the momentum oscillator RSI (14-period) is trading in a mid-range at ~44.81 levels and still struggling to cross and sustain the level above the past 21-period SMA and 50-period SMA, indicating an indecisive stance. An important support level for the stock is placed at AUD 0.60, while the key resistance level is placed at AUD 0.71.

Considering its Technical Analysis and latest financial performance, its current trading levels seems to be unstable to invest, hence a ‘Watch’ stance is suggested. The stock was analysed as per the closing price of AUD 0.660 per share, as of 28^th October 2021.

Daily Technical Chart – BMM

Source: REFINITIV 

Note 1: The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decisions should be made depending on the investors’ appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest. 

The Green colour line reflects the 21-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period, then it shows prices are currently trading in a bullish trend, (Vice – Versa).

The Blue colour line reflects the 50-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 50-period, then it shows prices are currently trading in a bullish trend, (Vice – Versa).

The Purple colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

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