Mahindra & Mahindra, a passenger car and utility vehicle maker, rose more than 30 per cent in the last 3 months compared to 0.5 per cent upside seen in the Nifty50 in the same period, and the rally may not be over yet.
The automaker has been on buyers’ radar so far in 2022 pushing the stock to a fresh 52-week high of Rs 1043 on 31 May 2022 on the BSE. The stock bounced back after hitting a low of Rs 671 in March 2022.
The stock has been moving in a higher high and higher low range which is bullish in nature. The stock recently took support near Rs 850 levels earlier in May 2022 and then bounced back which will now become a stop loss for all long positions.
Earlier in May M&M reported a 427 per cent jump in its standalone profit after tax (PAT) at Rs 1,292 crore, for the quarter ended March 2022. The auto major had clocked an of Rs 245 crore in the same quarter last year.
The stock has rallied over 23 per cent so far in the year 2022 and has more than trebled since its Covid 2020 lows.
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The technical structure suggests a continuation of momentum and is a good buy on dips stock towards Rs 935-919 levels. A close below Rs 919 can take the stock towards Rs 907-894-885 levels, suggest experts.
On the price action front, the stock is trading above short- and long-term moving averages. It is trading above 5,10,20,50,100 and 200-DMA which is a positive sign for the bulls.
“The stock price Started its up move from 246 (March 20). The stock made a high of Rs 666 (Sept 20) and after consolidation again moved up to Rs 952 (Feb 21),” Bharat Gala, President – Technical Research,
Securities, said.
“Profit-booking followed but the stock bounced from the averages and made a new high of Rs 979 (Nov 21). Thereafter the stock trended downwards and made a low of Rs 671 (March 22). Recently, continuous positive price candles have formed and stock made a high of Rs 961,” he said.
The continuous positive price candle supported by volumes suggests a new buying interest in the stock. The Aroon Up/down, ADX, MACD & PVT indicators suggest a possible firm uptrend.
“The possible targets are 1100-1300-1500. If the stock price corrects downwards the buy levels are (Rs 935-919) – Rs 907 – (Rs 894-885). A Stop Loss to be observed in the trade is Rs 850,” recommends Gala.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)
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