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Despite some weakness in the broader markets that continued from Friday, some stocks remained unscathed. Traders and investors were especially seen inclined towards Housing and Urban Development Corporation Ltd (NS:HUDC), or simply HUDCO. This is a specialized finance company that provides loans to firms operating in the real estate sector.
It has a market capitalization of INR 12,081 crores and trades at a very lucrative P/E ratio of 7.1. This counter is also known for its dividend and despite a run-up of 74% in the last 12 months, the stock is trading at a dividend yield of 5.14%. FIIs are gradually increasing their stake in this company, from 0.22% in June 2022 to 0.32% in June 2023.
Image Description: Daily chart of HUDCO with volume bars at the bottom
Image Source: Investing.com
On the technical front, the stock is looking quite good. After its rally from April 2023, in sync with the broader markets, the stock started trading sideways after the first week of June 2023. It showed some profit booking but the gradual U-shaped formation during the sideways movement spoke volumes about investors not looking to leave this counter anytime soon.
Today, HUDCO shares rallied 3.7% to INR 62.6 which is the highest closing in the last many years. In fact, today’s high of INR 64.4 is the highest level after May 2018. This 5-year high breakout was also supported by an expanded volume of 24.88 million shares, which is 308% higher than the 10-day average volume of 6.09 million shares.
As the trend has resumed on the upside, traders can keep this counter on the watchlist for hunting long opportunities. For a quick swing trade, a stop loss below the base, at INR 56.9 can be placed for the upside target of INR 67. If held for a few weeks, the level of INR 72 can also be achieved by this counter.
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