What's Going On With Some ASX Small Caps?

  • Oct 29, 2018 AEDT
  • Team Kalkine
What's Going On With Some ASX Small Caps?

Majorly all Australian market indices were trading into positive territory this morning, ignoring a negative move from the US. The Dow Jones was down by more than 1% or more than 300 points over the weekend while the NASDAQ and S&P were down by 500 points. Despite of bearish move seen in all major markets, ASX200 and ALL Ords showed a positive move and were up by almost 1% by mid-day trading, while the small ords were seen struggling during the session. The small cap index showed 0.15 % downside movement to 2541 by half day.

We saw stocks to the likes of Kogan.com Ltd (ASX:KGN) that nosedived on disappointing update related to lower first quarter margins owing to GST linked changes that helped competitive retailers. On the other hand, Mach7 Technologies Ltd (ASX: M7T) disclosed about a key contract being won in Hong Kong.

Meanwhile, buying and selling by the directors of their own stocks impacted many share prices lately. 

Biotron Limited (ASX: BIT) came up with its phase 2 drug trial results for HIV1 infection. The data released was highly positive and the impact for the same was seen on the share price movements soaring high with the highly positive data.

From the market cap of $10 million to the current market capitalization of $1.47 billion, Biotron has shown a huge growth trajectory this year. The growth was backed by the major development and results for the drugs tested for HIV1 and Hepatitis C virus. Trials came up with the positive data. HIV1 Phase 2 trial  posted positive news on September 18. Company received R&D tax incentive of $1.07 million in October-2018. Company has secured an underwriting agreement of $4.7 million for November 30, 2018 of $0.06. Hepatitis C virus has completed its Phase 2 process and is in the process of getting partnerships in china. China having the world’s largest population impacted by HCV, is one of the key targets for the company to bank on with its BIT225. The data from the trial has been consistent with targeting and eradication of virus from macrophage reservoir cells by BIT225. This is a major advance towards HIV 1 eradication. It also secured a deal of approximately US$3.7 million with pharma and biotech companies like J&J and Arrowhead towards Hepatitis B virus program. Detailed data is expected to be presented in late 2018 or early 2019 at scientific conferences. Positive results from the significant drug trials impacted the share price positively and created the value. The share price moved from $0.019 on September 27 to the current levels of $0.165 as on October 29, 2018. The company is rigorously focusing on achieving the commercial transaction for the HIV1 program. With the positive data report released on the drug trials for HIV1 and share prices on a high and adding value to the market cap, Biotron hit 20 bagger status during October-2018.

Other small caps that showed heavy movement on the charts included Buru Energy Limited (ASX: BRU).The company is into exploration and production of oil and gas in the Canning basin in the northwest of Western Australia. The chairman of BRU, Eric Streitberg  sold the stocks worth of approximately $2.1 million, which indicates that he is no longer the substantial shareholder as his holdings in the company stands at 4.9% well under the threshold limit of 5%. The selling was done on account of personal financial reasons. BRU shares fell after the sell off by the chairman of the Company. On October 29, 2018, the shares were up 2%.


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