Cellmid Limited 

CDY Details

FY21 Key Results Highlights: Cellmid Limited (ASX: CDY) is a health and beauty tech business consisting of two segments: Diagnostic and Consumer Health. It is involved in the R&D of diagnostic and therapeutic products for the management of diseases like cancer and others with inflammatory conditions.

• Chinese Distribution Agreements: Signed with Aeon International and Ourui Health Management in December 2020. The potential revenue lies in the distribution of Jo-Ju, Lexilis and Evolis, products in the hair segment.
• Divestment of Lyramid: An amount of $0.5mn and a royalty of 4% to be received in selling the subsidiary of CDY.
• Revenue Details: In FY21, the company reported revenue of $6.82mn, down 19% year over year, excluding the discontinuing activities.
• Direct to Consumers (DTC) Focus: The company invested in developing a new e-commerce website in FY21 to boost its DTC sales.
• Improvement in Net Losses: Reported a reduction in Net Loss by ~31%, from -$4.91mn in FY20 to -$3.39mn in FY21.

Revenue Highlight (Source: Analysis by Kalkine Group) 

Key Risks: The company is exposed to Government regulations domestically and internationally, besides the compliance risk that the company must abide by related to testing and ingredient sourcing. It is also exposed to various financial risks like credit, liquidity, interest, and market risks.

Outlook: Looking ahead with the market expansion in the US, China and Japan, and divestment of Lyramid, CDY progresses towards operational efficiency and operational profitability. The company intends to focus on e-commerce and innovation & development of new products in anti-aging hair care.

Stock Recommendation: The stock of CDY is trading lower than the average 52-week price level band of $0.049 and $0.135 with a negative return of -19.69% in past three months. On a TTM basis, the stock has been valued at EV/Sales multiple of 0.8x, lower than the median of Biotechnology & Medical Research Industry at 57.7x and Healthcare at 14.6x, implying undervaluation. Considering the company’s growing business, various strategic alliances & expansion in the US, Japan and China, current trading levels, and valuation on TTM basis, we give a “Speculative Buy” rating on the stock at the current market price of $0.0515, as on 6 September 2021, 11:20 AM (GMT+10), Sydney, Eastern Australia.

CDY Daily Technical Chart, Data Source: REFINITIV

Note, the purple color indicates the RSI and green color represents the share volume trend.

DigitalX Limited

 DCC Details

Q4FY21 & FY21 Key Results Highlights: DigitalX Limited (ASX: DCC) is a digital asset management and blockchain consulting company for businesses and institutional investors.

• Revenue Details: Recorded revenue of $9.71mn for FY21 Vs $0.42mn.
• Liquid Assets Position: DCC holding a total of $42.89mn liquid assets at the end of FY21 Vs $10.81mn at the end of FY20.
• Inflow from Fund Investors: A sum of $750k is decided to be invested in the Digital Assets Fund market, because of the recent drawdown in May & June 2021.
• NPAT Details: DCC reported an NPAT of $6.76mn in FY21 as compared to a loss of $6.84mn in FY20.
• Operating Cash Flow Details: A total of $1.26mn cash receipts from customers make the operating cash flow for the FY21 positive.
• Cash Expenditure Details: Due to the increase in staff and team members costs, overall cash expenditure increased to $738k in Q4FY21 Vs $658k in Q3FY21.
• Drawbridge’s RegTech: The application submission of grant funding with ASIC with an aim to become the digital governance standard for the world's 630k publicly listed companies.

Revenue Highlight (Source: Analysis by Kalkine Group) 

Key Risks: The company is dependent on Cryptocurrency prices fluctuations and changes in jurisdictional laws.

Outlook: The partnership with the Australian Federal Government for funding with Cooperative Research Centre (CRC), further investment in Digital Asset Fund and the RegTech innovation grant application, the overall outlook for the future of DCC looks positive.

Stock Recommendation: Over the last month, the stock has provided a positive return of 54.9% and is trading slightly below than the average 52-week price level band of $0.035 and $0.135. On a TTM basis, the stock is trading at EV/Sales multiple of 62x, above the Technology industry median of 5.7x, implying an overvaluation. Considering the company’s strong performance in FY21, further strategic investments, current trading levels, key risks and valuation based on TTM, we give a “Sell” rating on the stock at the current market price of $0.081, as on 6^th September 2021, at 11:00AM (GMT+10), Sydney, Eastern Australia.

DCC Weekly Technical Chart, Data Source: REFINITIV

Note, the purple color indicates the RSI and green color represents the share volume trend.

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 analysis has been achieved and is subject to the factors discussed above alongside support levels provided.

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 uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

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