Indian benchmark indices saw a rebound on Monday and settled higher. Results from the banking sector and positive global cues supported the sentiments at Dalal Street. BSE Sensex surged 602.75 points or 0.76 per cent, to end the session at 80,005.04. NSE's Nifty50 rallied 158.35 points, or 0.65 per cent, to close at 24,339.15 for the day.
Some buzzing railway stocks including Indian Railway Catering and Tourism Corporation Ltd (IRCTC), Rail Vikas Nigam Ltd (RVNL) and Ircon International Ltd are likely to remain under the spotlight of traders for the session today. Here is what Jigar S Patel, Technical Research Analyst, at Anand Rathi Shares and Stock Brokers has to say on these stocks ahead of Tuesday's trading session:
Indian Railway Catering and Tourism Corporation | Cautious
Since May 2024, IRCTC has been on a downtrend, consistently forming lower highs and lower lows. This pattern has led to a total correction of approximately 340 points, translating into a 30 per cent decline in value. The stock is trading below its 200-DEMA, which is a strong indication of ongoing weakness. On the technical indicator front, both the RSI and DMI on the daily chart are signalling further bearish momentum, reinforcing the stock’s negative outlook. Given these factors, a cautious approach is advisable, with a wait-and-watch stance as the stock may continue to slide. Our expectation is for IRCTC to potentially reach the Rs 775 level in the coming sessions, a zone that could present an ideal opportunity for a long position if the price stabilizes and begins to show signs of reversal.
Rail Vikas Nigam | Buy | Target Price: Rs 490 | Stop Loss: Rs 400
In the previous trading session, RVNL found support at its 200-DEMA, a significant technical level that often acts as a dynamic support during uptrends. Simultaneously, the daily RSI displayed a bullish divergence, suggesting potential reversal signals as buying interest strengthens at current levels. This confluence of support at the 200 DEMA, along with bullish RSI divergence, makes RVNL an attractive candidate for a long position. The current price action aligns with a previous consolidation range, which often indicates a robust base and reinforces the bullish outlook. Based on these factors, entering the stock in the Rs 425-435 range is advised, with an upside target of Rs 490, while placing a stop-loss at Rs 400 on a daily close basis to manage downside risk effectively.
Ircon International | Buy | Target Price: Rs 216 | Stop Loss: Rs 193
Despite trading below its 200-DEMA, which typically signals a bearish trend, Ircon displayed some encouraging technical signals in the previous trading session. It closed above a longstanding bearish trendline, a break that often signifies a potential trend reversal or, at minimum, a pause in the current downtrend. Adding to this, the RSI on the daily chart has shown a bullish divergence, suggesting that downward momentum is weakening, and buyers are gradually stepping in. This setup points to a possible short-term move towards the 200 DEMA as the next resistance level. Given these factors, a long position in the Rs 199-202 range is recommended, with a stop-loss at Rs 193 to limit risk. The target for this trade is set at Rs 216