Shares of S&P BSE Sensex hit 52-week high of Rs 282 on 20 May 2022 but failed to sustain momentum amid muted global cues. It bounced back after hitting a low of Rs 258 last week.
The stock with a market capitalization of over Rs 3.2 lakh crore is trading near important support levels which may trigger a bounce. It is also trading near the neckline of a falling trendline on the Daily charts.
Experts suggest a breakout above Rs 268-270 in next 4-6 weeks will confirm which may take the stock to 52-week high of Rs 280-284. The stock closed 1.7 per cent lower at Rs 265 on BSE on June 22, 2022. is one of India’s leading private sector companies and has a diverse presence in FMCG, Hotels, Packaging, Paperboard & Specialty Paper, and Agri-business.
Last month, the FMCG major reported an 11.80 per cent year-on-year (YoY) growth in standalone net profit for the March quarter to Rs 4,190.96 crore as compared to Rs 3,748.42 crore in the same quarter last year.
On the price front, the stock is trading above the 5-DMA but below the 10,20,30 and 50-DMA. This important long-term moving average is trading above the 100 and 200-DMA which is a positive sign for the bulls.
On the technical front, the relative strength index or RSI read at 48.5. The RSI below 30 is considered oversold and if the reading is above 70 it is considered overbought.
Average broker target as per Trendline database is Rs 319 which is 20 per cent higher than Rs 265 recorded on June 22. Consensus recommendation of 29 analysts for ITC. Strong buy.
“After the recent breakout, the stock is consolidating in a sideways trend and indicating a breakout from the falling trend line pattern,” said Kunal Shah, Senior Technical & Derivatives Analyst.
“RSI indicator has given positive crossover on the daily chart confirming the internal strength of the stock. The stock is trading well above its short term moving average and is likely to test its all-time highs,” he said.
Shah advises traders to buy the stock with a stop loss of Rs 260 and target above Rs 280-284. The holding period can be 4-6 weeks.
(Disclaimer: Recommendations, suggestions, views and opinions given by experts are their own. They do not represent the views of The Economic Times)