Shares of Vedanta Ltd rose over 2% on Monday to hit its record high amid weak sentiment in the benchmark indices. With today's rally, the the metal and mining firm has surpassed foreign brokerage CLSA's price target of Rs 520 assigned on August 22. It maintained an 'Outperform' rating on Vedanta.
The record high for the stock comes amid news reports that the board would consider fourth interim dividend for FY25 on Tuesday, October 8. The stock hit a record high for the second straight session today. In the previous session, the stock hit a record high of Rs 515.85 on BSE.
On Thursday (August 26), the stock crossed the Rs 500 mark for the first time on a closing basis on disclosure of date for considering fourth interim dividend for FY25 by the board.
In the current session, Vedanta stock climbed 2% to Rs 523.60 in early deals today against the previous close of Rs 512.85 on BSE. Market cap of the firm climbed to Rs 2.01 lakh crore. A total of 2.38 lakh shares of the firm changed hands amounting to a turnover of Rs 12.34 crore on BSE.
Vedanta shares have a one-year beta of 1.2, indicating high volatility during the period. In terms of technicals, the relative strength index (RSI) of Vedanta stands at 73.4, signaling the stock is trading in the overbought territory.
In terms of returns, the stock gained 100.52% in 2024 and rose 132% in a year. In five years, the stock has risen 234.79%. The large cap stock is trading higher than the 10 day, 20 day, 30 day, 50 day, 100 day, 150 day and 200 day moving averages signaling the stock is trading in bullish zone.
CLSA had said the Vedanta stock has underperformed peers and has not followed the uptick in metal prices in the past one month, while expecting the trend to reverse soon.
AR Ramachandaran from Tips2trades said, "Vedanta stock price is bearish & also overbought on the Daily charts with strong resistance at Rs 524. Investors are advised to keep booking profits as a Daily close below support of Rs 506 could lead to target of Rs 461 in the near term."
Mandar Bhojane, Equity Research Analyst at Choice Broking said, "Vedanta presents an appealing buying opportunity with a price target of Rs 500 and Rs 550, provided that appropriate risk management measures, such as a stop-loss at Rs 430, are in place."
Om Mehra, Technical analyst, SAMCO Securities said, "Vedanta has broken out of its declining trend after a prolonged consolidation, marking a new 52-week high of Rs 523.65. The Metal index is also showing strong upward traction, further supporting the bullish outlook. The stock is currently trading above its 20-day, 50-day, and 100-day moving averages. Notably, delivery volumes have surged—up 7.49% in the last month, with a 6.92% increase in 1-day delivery volume over the 5-day average, indicating strong buying interest. Both daily and weekly RSI remain above the 70 level, reflecting continued strength. Vedanta has a solid support base around Rs 490, and a decisive breakout above Rs 525 could push the stock towards Rs 560 levels."
Jigar S Patel from Anand Rathi Securities has advised investors to book profit. Fresh buying should be avoided.
"At this point, Vedanta appears to be highly overextended because it is trading significantly above all key exponential moving averages (EMAs) such as the 21, 50, 100, and 200-day EMAs. This indicates that the stock's price has surged well beyond its typical trend, suggesting that it may be due for a "mean reversion," where the price could potentially pull back to align more closely with its average levels. Such a deviation makes the stock more susceptible to a correction. Therefore, investors are advised to avoid taking new long positions at the moment, as the risk of a pullback is heightened. For those who have already bought, it’s recommended to book profit in the zone of Rs 515-525. Support is expected near Rs 485 following by Rs 470 and resistance is seen near Rs 525 followed by Rs 530 for short-term," said Patel.
Vedanta Ltd is a subsidiary of Vedanta Resources Ltd and has operations in oil and gas, zinc, lead, silver, copper, iron ore, steel, and aluminium and power across India, South Africa and Namibia.