Noumi Limited (ASX: NOU)

NOU was formed in 1984 and was earlier known as Freedom Foods Group Limited. Working in FMCG segment, it manufactures dairy and plant based nutritional products, beverages and ingredients related to health and fitness industries. Its market capitalization stood at AUD 106.68 million as of 16^th December 2021.

Financial & Operational Updates – On 29^th November 2021, its ASX code changed from FNP (Freedom Foods Group Limited) to NOU (Noumi Limited). On 17^th November 2021, it proposed to enter into a bank guarantee facility (separate) of upto USD 18 million. As per the 17^thNovember 2021 announcement, the license agreement dispute related to manufacturing and distribution of Almond Breeze products among FFPL (Freedom Foods Pty Ltd.) and Blue Diamond Growers have resulted in arbitration and settled as follows:

• FFPL will pay ~USD 25 million to Blue Diamond, where ~USD 17 million will be paid within 20 business days after the sign of the agreement.
• Future payments of ~USD 18 million will be paid in instalments of ~USD 4.5 million for four years starting from 1^st September 2022, supported by bank guarantee.

As per its 2021 AGM Presentation, its Net Revenue increased by ~8% Y-o-Y to ~AUD 559 million with a ~141% increase in Adjusted Operating EBITDA to ~AUD 22.4 million in FY21 (Pcp basis). Its Net Losses for the FY21 decreased by ~72% Y-o-Y from ~AUD 136.4 million to ~AUD 38.8 million. While on the other hand in Quarterly Report, NOU reported softer Q-o-Q results because of regional outbreak causing staff shortage in Shepparton, Victoria, and thereby restricting the production for two weeks in the 1QFY22. Its Total Revenue for 1QFY22 decreased by ~5.5% Q-o-Q to ~AUD 128.9 million with a ~46.4% Q-o-Q increase in revenue of Specialty Seafoods.

Its Net Losses for the FY21 decreased by ~72% Y-o-Y from ~AUD 136.4 million to ~AUD 38.8 million. Its sales receipts for 1QFY22 were reported as AUD 127.21 million and closed the quarter with a cash balance of ~AUD 9.76 million at the end of 30^th September 2021 versus ~AUD 31.67 million at the end of 30^th June 2021.

Technical Analysis: NOU's prices recently started to gain upside momentum after making a new 52-week low of AUD 0.360, indicating the possibility of an upside reversal hereon. On the daily chart, the RSI (14-period) has recovered from oversold levels and is placed at ~41.017, supporting a positive bias. Now an immediate support level for the stock is placed at AUD 0.34 while the resistance level is at AUD 0.43.

With a view of resolving the legal suit, its financial performance and current levels, the investors with a high-risk appetite might consider a ‘Speculative Buy’ position, incorporating the support and resistance as one of the tools while analysing the investment opportunity. The stock was analysed as per the current price of AUD 0.380, as of 16^th December 2021, 03:22 PM (GMT+10), Sydney, Eastern Australia. However, the risk levels are extremely high in view of the production capacity and sales related to its products.

Daily Technical Chart – NOU

Source: REFINITIV

Clean Teq Water Ltd (ASX: CNQ)

It is involved in metal treatment and water treatment solutions to industrial, municipal and mining sectors. Its products are CIF (Continuous Ionic Filtration), HIROX (Ultra High Recovery Reverse Osmosi), DESALX (Membrane Free Desalination), BIOCLENS (Encapsulated Bacteria Lenses), BIONEX (Nutrient Removal), and EVAPX (Evaporation and Crystallization). Its market capitalization stood at AUD 33.05 million as of 16^th December 2021.

Financial and Operational Updates: On 3^rd December, the company intended to participate in the new tender issued by Townsville City Council. On 2^nd December it signed an agreement with MCC Energy Conversation and Environmental Protection (industry leader in steel sector in China) to promote BIONEX technology across the steel sector in China. Also, signing the same type of agreement with gas and oil sector in Middle East with the National Energy Services Reunited Corp. As per its quarterly report on 25^th October 2021, its net cash used in operating activities came out as ~AUD 2.1 million and its sales receipts for 1QFY22 were ~AUD 1.55 million and closed the quarter with a cash balance of ~AUD 13.75 million at the end of 30^th September 2021. It signed two contracts during 1QFY21 of ~AUD 5 million which will lead to five projects of worth ~AUD 13 million.

Technical Analysis: CNQ started trading on ASX on 2^nd July 2021 following its demerger from Sunrise Energy Metals. On a weekly chart, it is taking the support of upward sloping trendline, indicating a positive stance. The momentum oscillator RSI (14-period) is trading at ~50.482 level. An important support level for the stock is placed at AUD 0.65 while the key resistance level is placed at AUD 0.81.

With a view of its recent contracts and quarter updates, the investors with a high-risk appetite might consider a ‘Speculative Buy’ position, incorporating the support and resistance as one of the tools while analysing the investment opportunity. The stock was analysed as per the current price of AUD 0.710, as of 16^th December 2021, 11:53 AM (GMT+10), Sydney, Eastern Australia. However, the risk levels are extremely high in view of the upcoming updates on the company’s outlook which is expected to announce shortly.

Weekly Technical Chart – CNQ

Source: REFINITIV

Nuix Limited (ASX: NXL)

Incorporated in 2005, it is a software company dealing into investigative analytics and intelligence software. Its market capitalization as of 16^th December 2021 stood at AUD 666.36 million.

Legal Suits: As per 29^th November 2021’s Update, a second-class action claim has been filed against NXL in the Supreme Court by Phi Finney Mc Donald on behalf of Daniel Joseph Batchelor, which is imposed regarding the information contained in the NXL’s IPO Prospectus and its disclosure related to FY21 revenue forecasts. Also, another claim has been lodged by a former CEO related to his claimed compensation.

Financial & Operational Updates –

On 26^th November Jonathan Rubinsztein was appointed as CEO and Executive Director, commencing on 6^th December 2021. As per the Annual Report, its statutory revenue from ordinary activities increased by ~0.1% and was recorded as ~AUD 176.1 million for FY21 and recorded Annualised Contract Value as ~AUD 165.6 million which is down by ~1.7% on Pcp basis. Its Pro Forma EBITDA was up by ~20.9% Y-o-Y as ~AUD 67.0 million.

Technical Analysis: On the weekly chart, NXL prices are trading in lower zone and below the trend-following indicators 21-period SMA and 50-period SMA, which may act as a resistance level for the stock. However, the momentum oscillator RSI (14-period) is trading near an oversold zone at (~34.879 level), which indicates the possibility of rebound in the stock from the current levels. The crucial support level for the stock is placed at AUD 1.90, while the key resistance is at AUD 2.40.

A ‘Watch’ stance is suggested after considering the company’s ongoing unresolved lawsuits. The stock was analyzed as per the closing price of AUD 2.16 per share, down by ~2.857%, as of 16^th December 2021.

Weekly Technical Chart – NXL

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 Yellow colour line represents the Trendline.

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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