Shares of defence major Cochin Shipyard hit upper circuit of 5% on Monday. The multibagger stock rose 5% to Rs 2671.80 on BSE. It closed at the same level today. With today’s gain, the stock is up 745% from its 52 week low. The defence stock fell to a yearly low of Rs 316.50 on August 11, 2023. Market cap of the defence stock rose to Rs 70,290 crore.
Earlier, Cochin Shipyard stock opened higher at Rs 2501.05 on BSE today agains the previous close of Rs 2544.60. Total 4.85 lakh shares of the firm changed hands amounting to a turnover of Rs 127.56 crore on BSE. Cochin Shipyard has a one-year beta of 1, indicating average volatility during the period.
The stock has delivered multibagger returns of 1545% in the two years and risen 700% in a year.
In terms of technicals, the relative strength index (RSI) of the stock stands at 56, signaling the stock is trading neither in the overbought nor in the oversold zone. Cochin Shipyard shares are trading higher than the 5 day, 10 day, 20 day, 50 day, 100 day and 200 day moving averages.
Riyank Arora Technical Analyst at Mehta Equities said, "Cochin Shipyard exhibits a robust bullish trend with significant potential for further gains. Monitoring the RSI and volume will be essential for detecting any potential reversal signals. The immediate resistance at Rs 2670.35 is a critical level; if surpassed, it could lead to a target of Rs 2979.45 or higher. The immediate support level is at Rs 2462, with strong support at Rs 2108.05. The relative strength index (RSI) is currently at 61.03, indicating moderately strong momentum but not overbought."
Shiju Koothupalakkal, Technical Research Analyst, Prabhudas Lilladher said, "The stock has indicated a higher low formation pattern on the daily chart after the short period of correction taking support near 2460 zone to witness a decent pullback improving the bias. With the RSI cooling off from the highly overbought zone, currently is well placed and we can anticipate further rise with initial target of Rs 2780 visible and thereafter, strength sustaining can carry the stock to Rs 2930 levels in the coming days. Rs 2460 would be maintained as the near-term support as of now."
Mandar Bhojane, Equity Research Analyst at Choice Broking said, "The stock is currently trading at Rs 2670.35, showcasing a notable 5% surge on July 22, 2024. This upward momentum is supported by a reversal from the support level on the daily chart, accompanied by robust trading volume. These patterns underscore a strong upward trajectory in the stock. The Relative Strength Index (RSI) stands at 61 and is on an upward trend, signifying a significant surge in buying momentum. Both RSI and Stochastic RSI in the overbought region suggest that positional traders may consider holding their positions and implementing a trailing stop-loss. The overall trend is bullish, with confluence from various technical indicators reinforcing the optimistic outlook. Given these signals, there is potential for the stock to achieve a target price of Rs 3400 and Rs 3700 in the near term.”
“It is advisable to consider buying on dips, particularly around Rs 2300, to capitalize on potential retracements in the stock price. To prudently manage risk, implementing a stop-loss at Rs 2150 is recommended. This precautionary measure is crucial to safeguard investments in the event of an unexpected market reversal," added Bhojane.
Kushal Gandhi, Technical Analyst, StoxBox said, "Share price of Cochin Shipyard has delivered significant returns over the past year and continues to show promise for further growth. Analysis of the daily chart reveals a pattern of decreasing volatility in conjunction with high EPS, robust price strength, and strong buyer demand. The contraction within the ongoing uptrend signifies savvy investors' absorption of available supply to reinforce the existing trend. Additionally, the stock has experienced notable technical pullbacks following tests of its short-term moving averages, indicating the presence of momentum and strength in the trend. Following a sharp technical pullback after retesting the average line, the stock presents a low-risk, high-reward opportunity. We recommend buying Cochin Shipyard with a target price of Rs 3150 and a protective stop at Rs 2455."
Cochin Shipyard is primarily engaged in shipbuilding and ship repair, catering to both the domestic and international markets. The company is a “Miniratna”, Schedule-“B”, Category-I CPSE, which also a public limited company incorporated and domiciled in India.