Recce Pharmaceuticals Ltd (ASX: RCE)

Listed on ASX in 2016, RCE is an Australian Pharmaceutical company. To address antibiotic-resistant superbugs and emerging viral pathogens, RCE operates toward the development and commercialisation of synthetic anti-Infectives. Its market capitalisation stood at AUD 199.85 million as of 14^th February 2022.

Operational and 2QFY22 Financial Updates:

• On 7^th February 2022, results from the Third Cohort of Phase I Clinical Trial of new classes of Synthetic Anti-infectives – RECEE® (327), indicated as safe and well-tolerated when seven subjects were intravenously dosed.
• As per the quarterly report released on 31^st January 2022, the company reported broad-spectrum efficacy among all the patients for its phase I/II clinical trial of R327 for treatment of burn wound infections.
• The operating cashflow stood at ~AUD 2.63 million in the second quarter, and cash at the end of 31^st December 2021 was recorded as ~AUD 15.83 million, same as the previous quarter at the end of 31^st September 2021.

FY21 Top and Bottom Line: As per the annual report, other income was reported as ~AUD 1.96 million in FY21. The net losses for FY21 rose substantially by ~213% Y-o-Y and were recorded as ~AUD 13.51 million versus ~AUD 4.32 million in FY20.

Technical Analysis: On a daily chart, RCE stock prices are sustaining below the horizontal trendline and facing the resistance of the same. The momentum oscillator RSI (14-period) is trading at ~39.36 level, indicating the negative momentum. Moreover, prices are trading below the trend-following indicators 21-period and 50-period SMA, which may act as a resistance zone. The important support level for the stock is placed at AUD 0.970, while the key resistance level is placed at AUD 1.190.

Considering the stock’s consolidating mood and subdued financials, investment in RCE at this price should be taken with extra caution hence a ‘Watch’ stance is suggested. The stock was analysed as per the closing price of AUD 1.0800 per share, down by ~6.087%, as of 14^th February 2022.

Daily Technical Chart – RCE

Source: REFINITIV

Firebrick Pharma Limited (ASX: FRE)

An Australian company listed on ASX on 28th January 2022, FRE works in the pharmaceutical industry and develops Nasodine – a nasal spray. The company is involved in product formulation, packaging, and manufacturing development. As of 14^th February 2022, the company’s market capitalisation stood at AUD 84.42 million.

Operational and 1HFY22 Financial Updates:

• On 10^th February 2022, a pilot study of a small number of COVID-19 subjects and the results of in vitro studies of Nasodine® were published in the Australian Journal of Otolaryngology (AJO).
• On 1^st February 2022, its Nasodine® - nasal spray for SARS-CoV-2 held in South Africa received its approval and gave heads-up to proceed from South African Health Products Regulatory Authority (SAHPRA).
• The company started its February month with the following substantial shareholding:

37. The company itself holds a voting power of ~37.15%.
38. As a founder of FRE, Mr Stephen Francis Goodall/Biotech Design Pty Ltd became a substantial shareholder of FRE by having voting power of ~17.96%.
39. As a founder of FRE, Mr Peter Laurence Molloy/ Aquarico Pty Ltd became a substantial shareholder of FRE by having voting power of ~17.96%.

• As per the half-yearly update on 11^th February 2022, the company reported a revenue from ordinary activities as ~AUD 3.37k in its 1HFY22 versus NIL in 1HFY21. Mainly owing to R&D expenses and consulting fees, the company reported an increase in net losses and recorded the same as ~AUD 1.54 million in 1HFY22 versus ~AUD 979k in 1HFY21.
• The company closed its first-half ending 31^st December 2021 with a cash balance of ~AUD 4.32 million versus ~AUD 1.15 million as of 30^th June 2021.

FY21 Top and Bottom Line: As per the annual report, the company reported a decrease on a Y-o-Y basis in its other income from ~AUD 508k in FY20 to ~AUD 422k in FY21. Moreover, it had posted an increase in its net losses to ~AUD 2.44 million in FY21.

Technical Analysis: Since FRE started trading on ASX on 28^th January 2022, FRE is a new bud on ASX. And due to a lack of technical data, its analysis is not valid.

Considering the unavailability of technical levels and its subdued performance in first-half of FY22, a ‘Watch’ stance is suggested. The stock was analysed as per the closing price of AUD 0.480 per share, down by ~4.001%, as of 14^th February 2022.

Daily Technical Chart – FRE

Source: REFINITIV

Orcoda Limited (ASX: ODA)

ODA was Listed on ASX in 1986 and is a logistics solutions company that operates in three segments: Transport Logistics, Resource Logistics and Healthcare Logistics. As of 11th February 2022, its market capitalisation stood at AUD 22.13 million.

Operational Updates & 2QFY22 Financials:

• On 10^th and 4^th February 2022, Mr Samuel Yue and William Buck Corporate Advisory (Vic) Pty Ltd were appointed as Chief Financial Officer and Corporate Advisor to the company, respectively. Where the former will be responsible for the financial and commercial management of the company.
• A total of 7,475,000 fully paid ordinary shares were released from the escrow on 12^th February 2022 (12 months from the date of issue).
• As per its 2QFY22 quarterly report released on 27^th January 2022, with the M-o-M increase in its revenue of its healthcare logistics division, the company’s consolidated revenue (un-audited) grew by ~26% to ~AUD 8.2 million versus ~AUD 6.5 million in 1HFY21. The cash receipts from the customers were recorded as ~AUD 4.32 million for 2QFY22 with ~AUD 8.89 on a year-to-date basis.
• Its EBITDA (unaudited and not consolidated) for the three operating divisions was reported as ~AUD 1.6 million for the half-year.
• With a sixth consecutive cash operating inflow, the company recorded the same as ~AUD 498k and increased its cash and cash equivalents by ~16% Q-o-Q from ~AUD 2.76 million in 1QFY22 to ~AUD 3.21 million in 2QFY22.
• The company signed a three-year contract with the Bob & Pete’s to provide Orcoda’s Logistics Management System (OLMS) and consulting services.

Technical Analysis: ODA has been trading in a broad range of ~AUD 0.105 to ~AUD 0.215 since November 2021. On a weekly chart, the prices are trading around the trend-following indicators 21-period SMA and 50-period SMA; however, struggling to surpass the same, indicating a negative bias. On a weekly chart, the momentum oscillator RSI (14-period) is hovering around the mid-point and currently trading at ~46.42 level. Now the next important support level for the stock is at AUD 0.135, while resistance is at AUD 0.170 level.

Due to the stock’s prices’ lacklustre levels and indecisive attitude, a ‘Watch’ stance is suggested until it shows any signs of any reversals. Being 14^th February 2022 a non-trading day for ODA, the stock was analysed as per the closing price of AUD 0.150 per share, as of 11^th February 2022.

Weekly Technical Chart – ODA

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 reflects the Trendline, which shows whether the direction of the scrip is upwards or downwards.

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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