Stock Coming Out of Base, Witnesses 600% Volume Jump!

  • Stock Market Analysis
  • Editors Pick

After a sharp cut on Tuesday, the mid-cap space is witnessing a bounce back as investors who were waiting for the dip are probably buying their favorite shares. The Nifty Midcap 100 index jumped 0.28% to 40,829.9 on Friday and with it, many mid-cap shares also attracted investors’ interest.

One counter that received a good demand was IPCA Laboratories Limited. It is a pharmaceutical company with a market capitalization of INR 22,868 crore and trades at a TTM P/E ratio of 46.57. Although the company's Q1 FY24 revenue remained almost stagnant as compared to the same period last year, the net profit jumped 13.8% to INR 162.82 crore in Q1 FY24, the highest since Q3 FY22. Despite trimming down the stake, FIIs still hold a 10.05% interest in the company, as of June 2023.

Image Description: Daily chart of IPCA Laboratories with volume bars at the bottom

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On the technical front, the stock witnessed a stupendous rally from the May 2023 low of INR 669.8 to the CMP of INR 930.75. This sharp rally which led to a 39% increase in the share price soon turned into a sideways movement that took the shape of a rounded bottom-like formation.

On Friday, the stock jumped 3.26% and showed signs of coming out of this consolidation phase. The volume on Friday was recorded at over 1.95 million shares, which is around 600% higher than the 10-day average volume of 278K shares. The stock is about to give a breakout above the resistance of INR 940 which is when the bullish tone in this counter will further strengthen.

An exit level for long positions can be maintained below INR 860 and the stock seems to be gearing up to rally to 1,020 in the next couple of months.

Thank you to all who attended the webinar by Aayush Khanna on 13 September. Those of you who missed the session can access the full recording here:

Remember, the once-in-a-lifetime offer of a 65% discount on InvestingPro+ via the coupon code PROW629 is only valid till 30th September 2023 and for new subscriptions only.

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  • karan oberoi @karan oberoi
    Thanks 🙂
    Like 2
    • Aayush Khanna @Aayush Khanna
      You're welcome, Karan.
      Like 1
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  • Syed Mateen @Syed Mateen
    Bro trent ka view please i am holding 2000 pe 2k quantity running loss is 75k .. i read ur analysis last about trent overvalued n bought.. suggest
    Like 2

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