Unveiling the Potential: Larsen & Toubro Finance Holdings and the Paint Sector

  • Stock Market Analysis

In today's article, we'll delve into Larsen & Toubro Finance Holdings (NS: LART ). Moreover, we will also take a look at some prominent players in the paint sector. However, I will only look at L&T Finance via the article. This is because I have chosen to look at the paint sector via a YouTube video attached below as there is more content to cover for the paint sector. I am looking at the sector as a whole along with a few chosen paint stocks such as Asian Paints (NS: ASPN ), Berger Paints (NS: BRGR ) and Kansai Nerolac Paints (NS: KANE ). 

Now turning our attention to Larsen & Toubro Finance Holdings. Of late, the stock has done very well. I say this as the equity has managed to ride out the bearish sentiment that grappled the market in September 2023. This is because while the market was taking a dive but the equity remained sideways. However, I now believe we are reaching an end to the sideways move because we are beginning to see a bullish volume buildup reappear in the stock.

For example, in August 2023, the volume buildup was 44% in favor of the bulls while 56% was in favor of the bears. Hence, this resulted in a sideways move as neither side had the volume to trigger an upswing or a downswing. However, now the table seems to have turned, as last week the volume buildup stood at 68% in favor of the bulls. Hence, this should let the stock test the top-of-the-box range. Plus, if more bullish volume were to appear at the top, then we could have a strong breakout above the range.

Now, in terms of price targets, I expect the stock to test Rs. 138.5 in the near term, and this move ought to be great for short-term derivative traders who focus more on CE buying. However, if it manages to break the resistance at Rs. 138.5, then we will have a medium-term up-move until Rs. 150 and Rs. 166. If this occurs, then it will be great for equity traders and option sellers, as selling PEs will give a good return.

In summation, the stock presents a compelling opportunity for investors and traders and its commendable performance amid the market turmoil has made it an outlier. Furthermore, its promising chart structure suggests that if it can surmount the Rs. 138.5 price hurdle, then the equity is poised for a notable ascent. Lastly, do watch the attached YouTube video because it will let you know how big names in the paint sector will perform. 

Happy trading!

Disclaimer: The investments discussed by Sandeep Singh Ahluwalia may not be suitable for all investors. Thus, you must trust your analysis and judgment before making investment decisions. The report provided is for informational purposes only and should not be interpreted as a proposition to buy or sell any securities.

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  • Sabari Parthi @Sabari Parthi
    we already have in Demat portfolio 💪
    Like 0
  • Nikhil Pai @Nikhil Pai
    Link posted is for L&T, plz add correct L&T Fin link
    Like 0

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