Identitii Limited (ASX: ID8)

ID8 is a software company incorporated in 2014. It is working on anti-money laundering (AML) and counter terrorist financing (CTF) compliance risk to cater the financial services businesses.  Its market capitalization stood at AUD 27.37 million as of 27^th October 2021.

Financial & Operational Updates – As per the announcement on 26^th October 2021, the company got its binding commitment related to a capital raise of AUD 6 million through placement of shares to sophisticated and institutional investors, which will be used to strengthen growth initiatives. It remained at trading halt from 22^nd – 26^th October 2021, due to the capital rising plans. On 7^th October 2021, Mr. Nick Armstrong, Co-Founder resigned from the board. In September 2021, it launched its new SaaS platform – IS0 20022 – for AUSTRAC compliance, covering 15,000 entities.

As per the Annual Report 2021, its revenue from contracts increased by ~45% Y-o-Y, reported as ~AUD 1.36 million in FY21 versus ~AUD 0.94 million in last year. Its net loss for the FY21 decreased by ~18% and reached ~AUD 5.87 million versus loss of ~AUD 7.07 million reported last year. The company’s cash and cash equivalents status increased substantially, from ~AUD 1.41 million as of 30^th June 2020 to ~AUD 4.48 million as of 30^th June 2021.

Technical Analysis: ID8's price is trading above a horizontal trend line support level AUD 0.140 and above the trend-following indicators 21-period SMA and 50-period SMA, indicating a positive stance. On the weekly chart, the momentum oscillator RSI (14-period) is trading in positive territory at ~56.080 levels and has recovered from an overbought zone, further supporting a positive momentum. An important support level for the stock is placed at AUD 0.17, while the key resistance level is placed at AUD 0.21.

With the improving financial performance and consideration of its current levels, the investors with a high-risk appetite can consider it as a ‘Speculative Buy’ stance, keeping the support and resistance levels as crucial points. The stock was analysed as per the current market price of AUD 0.185 per share, 03:54 PM (GMT+10), Sydney, Eastern Australia, as of 27^th October 2021. However, the risk levels are high considering the developments in technological environment.

Weekly Technical Chart – ID8

Source: REFINITIV

Sayona Mining Limited (ASX: SYA)

Incorporated in 2000, SYA is involved in identification, acquisition and exploration of minerals, with a focus on Lithium. It covers Australia and Overseas, having the Authier Lithium Project in Qubec, Canada and Tansim Lithium Project in Canada as flagship projects. Its market capitalization stood at AUD 1.23 billion as of 27^th October 2021.

Financial and Operational Updates: As per the Annual Report released on 22^nd October 2021, the company recorded an increase in revenue and other income as ~AUD 0.64 in FY21 versus ~AUD 0.006 last year. It had recorded net loss after tax of ~AUD 4.37 million for FY21 as against ~AUD 5.40 million in FY20. Cash at the end of FY21 was reported at ~AUD 35.50 million versus ~AUD 0.49 million in pcp. After completing 60% acquisition of Moblan Lithium Project (for USD 86.5 million), on 18^th October 2021 it announced a resource increase in North American Lithium Market and plans to commence the drilling program in 2022. To commensurate the transaction, SYA raised an additional ~AUD 25.5 million through rights issue offered to the shareholders in 1:35 ratio. New shares to be issued at a price of AUD 0.145 and to be allotted on 1^st November 2021.

Technical Analysis: On a weekly chart, SYA price witnessed a steep rally from the low of AUD 0.112 to a 52-week high of AUD 0.20 tested on 20 September 2021. Currently the prices are consolidating at higher levels. The prices are trading above the trend-following indicators 21-period SMA and 50-period SMA, which may act as a support levels. Moreover, the momentum oscillator RSI (14-period) is trading near an overbought zone at (~69.07 level) and formed negative divergence, which might indicate the possibility of a downside correction from the higher levels. The important for the support levels stock is placed at AUD 0.150 while resistance level is at AUD 0.185.

A ‘Watch’ stance is suggested after considering the risk attached with the scrip, when there is a negative divergence formation in current RSI levels. The stock was analysed as per the closing price of AUD 0.165 per share, down by ~8.334%, as of 27^th October 2021.

Weekly Technical Chart – SYA

Source: REFINITIV

Breaker Resources NL (ASX: BRB)

BRB is a mineral exploration and development company, mainly focused on Gold. The company was incorporated in 2010. Some of its projects are Lake Roe Gold Project and Ularring Gold Project. Its market capitalization stood at AUD 109.15 million as of 27^th October 2021.

Financial and Operational Updates: As per the Annual Report for FY21 on 18^th October 2021, the total income was reported as ~AUD 0.19 million for FY21 as against ~AUD 0.24 million in FY20. Its Net Losses after Income Tax increased to ~AUD 15.17 million in FY21 from ~AUD 10.93 million in FY20. Cash at the end was reported as ~AUD 4.53 million as of 30^th June 2021 versus ~AUD 3.64 million in PcP. As per the announcement on 11^th October 2021, high-grade gold mineralisation extended 3m @ 21.53g/t Au Tura Zone of Bombora Deposit at its 1.4Moz Lake Roe Gold Project.

Technical Analysis: On a weekly chart, BRB stock prices are sustaining below the horizontal trend line resistance level at AUD 0.335 and facing the resistance support of the same. The momentum oscillator RSI (14-period) is trading in an overbought zone at (~73.257 level), which indicate the possibility of a downside correction from the higher levels. However, prices are trading above the trend-following indicators 21-period SMA and 50-period SMA, which may act as a support levels. The crucial support and resistance levels are AUD 0.245 and AUD 0.350, respectively.

Due to its muted results and its current higher RSI levels a ‘Watch’ stance is suggested. The stock was analysed as per the closing price of AUD 0.315 per share, down by ~5.971%, as of 27^th October 2021.

Weekly Technical Chart – BRB

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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