Revasum Inc (ASX: RVS)

Incorporated in 2016, RVS deals into manufacturing of Chemical Mechanical Planarization (CMP) grinding and substrate manufacturing equipment which are used in the production of semi-conductor devices. Based in United States, its market capitalization stood at AUD 40.13 million as of September 29, 2021, at a stock price of AUD 0.380 per share.

Financial & Operational Updates – In the latest news released on September 13, 2021, RVS appointed Rebecca Shooter-Dodd as President and CEO effective immediately. As per the Half Year Report released on 25^th August 2021, revenue from ordinary activities was down by ~29.22% Y-o-Y reported as ~USD 4.61 million in 1HFY21 versus ~USD 6.52 million in 1HFY20, excluding a sales backlog of ~USD 10 million to be confirmed at the end of 1HFY21. Despite lower revenues, Gross Profit for 1HFY21 was reported as ~USD 2.20 million, an increase of ~162.2% Y-o-Y, owing to revision of list prices and cost containment measures. A substantial decrease of ~70.4% in Operating Losses was reported as ~USD 2.40 million for 1HFY21, due to a decrease of ~48.6% in operating expenses largely led by absence of impairment charge of ~USD 3.0 million incurred in 1HFY20. Cash at the end of FY21 was reported as ~USD 6.13 million as of 30^th June 2021 versus ~USD 1.36 million in PcP.

Technical Analysis: RVS’ price has been into a range-bound movement for the past 2 months and consolidating with a positive bias. On the daily chart, the current market price is still struggling to get past the 21-period SMA and 50-period SMA; however, trading above both the SMAs on the weekly chart, indicating an upside direction. The RSI (14-period) is hovering around the mid-point and trading at ~43.161 levels. Now an immediate support level for the stock is at AUD 0.345 level while resistance is at AUD 0.450 level.

With a substantial decrease in operating expenses and increase in gross margin and considering its financial performance in 1HFY21, the company is indicating a growing future. On the technical front, considering RSI & 21 SMA level, 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 29^th September 2021, 11:17 AM (GMT+10), Sydney, Eastern Australia. However, the risk levels are high in view of the company’s ability to maintain its operational efficiency.

Daily Technical Chart – RVS

Source: REFINITIV

Big River Industries Limited (ASX: BRI)

BIR was incorporated in 2015 in Australia, is involved manufacturing and distribution of timber and building products like veneer, plywood, and formply. It caters to professional builders, formworkers, construction companies and building contractors for residential, non-residential and infrastructure building markets. Its market capitalization as of 29^th September 2021 stood at AUD 164.47 million and the share price stood at AUD 2.06 per share.

Financial & Operational Updates – As per the Annual Report released on 24^th September 2021, revenue from ordinary operations was up by ~13.0% Y-o-Y and reported as ~AUD 281.38 million in FY21 versus ~AUD 248.92 million in FY20. A substantial decrease of ~59.1% in Net Profit from ordinary operations was reported as ~AUD 1.82 million in FY21 versus ~AUD 4.44 million in FY20. Cash at the end of FY21 was reported as ~AUD 7.85 million as of 30^th June 2021 versus ~AUD 8.71 million in PcP. On 24^th August, fully franked final dividend was determined as 3.00 cents per fully paid ordinary share, to be paid on 6^th October 2021. On the same date, BRI signed an agreement to acquire trading business and assets of Revolution Wood Panels Pty Ltd (RWP), which is expected to be completed by October 2021.

Technical Analysis: On the daily chart, BRI stock prices are sustaining below the falling trendline resistance level and continuously facing the resistance of the same at AUD 2.16 level. Moreover, the prices are trading below the trend-following indicator 21-period SMA indicating negative momentum in the stock. Furthermore, the momentum oscillator RSI (14-period) is trading at ~51.193 level. An important support level for the stock, is placed at AUD 1.92 while the key resistance level is placed at AUD 2.17.

With the substantial decrease in the Net Profit for FY21 and RSI levels, investing in this stock at current price levels should be taken with calculated approach, hence a ‘Watch’ stance is suggested. The stock was analyzed as per the closing price of AUD 2.060 per share, up by ~0.980% as of 29^th September 2021.

Daily Technical Chart – BRI

Source: REFINITIV

Holista CollTech Limited (ASX: HCT)

Based in Australia, HCT was incorporated in 2000, and is involved in researching, developing, manufacturing, and marketing of health style products like Supplements, Ovine collagen, Food ingredients, and Infection control. Its market capitalization stood at AUD 15.97 million as of September 29, 2021, at a stock price of AUD 0.059 per share.

Financial & Operational Updates – As per the release on 16^th September 2021, its sanitiser brand “Natshield” received a trademark labelling approval in China. As per the Interim Financial Report released on 27^th August 2021, revenue from ordinary operations was up by ~29.7% Y-o-Y and reported as ~AUD 3.58 million in 1HFY21. A substantial decrease of ~87.1% in Net Losses was reported as ~AUD 629k in 1HFY21. Cash at the end of 1HFY21 was reported as ~AUD 2.12 million as of 30^th June 2021 versus ~AUD 2.73 million in PcP. As per the announcement on 27^th August 2021, trading of HCT on ASX was temporarily paused. As per the ASX Announcement on 5^th August 2021, it served proceedings with Federal Court regarding the allegations of misleading statements related to its sanitiser products and partnerships with GICC.

Technical Analysis:  HCT’s daily price chart has witnessed range bound movement between AUD 0.048 to AUD 0.070 since past six months indicating indecision in the stock prices. The momentum oscillator RSI (14-period) is trading in the mid-range at ~45.969 level indicating the prices are losing momentum. Moreover, the current market price is hovering below the trend-following indicators 21-period SMA and 50-period SMA, further indicating that prices are trading in a weak tone. Immediate support levels are AUD 0.052 and AUD 0.048 while immediate resistance levels are AUD 0.063 and AUD 0.070.

Considering its ongoing legal proceedings with Federal Court, weak momentum, and its RSI level, investing in this stock at current uncertainty should be taken with extreme caution, hence a ‘Watch’ stance is suggested. The stock was analyzed as per the closing price of AUD 0.059 per share, up by ~1.724%, as of 29^th September 2021.

Daily Technical Chart – HCT

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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