Shares of Garden Reach Shipbuilders & Engineers Ltd (GRSE) have risen 32% in the last five sessions, clocking maximum gains for the defence stock in a period up to a year. The multibagger defence stock climbed 27.59% in a month and reported a rally of 9.28% in three months.
In the current session, the stock added another 4.68% a day after closing 20% higher at Rs 1641.15 on BSE. The defence stock closed at Rs 1,718 on BSE today.
The stock rose over 6% intraday in the current session after the defence sector firm said it has inked a MoU with PWD (Roads & Bridges), Nagaland for supply of 8 sets of double lane modular steel bridges in Nagaland.
Market cap of the firm stood at Rs 19,680 crore. On BSE, around 4.65 lakh shares changed hands amounting to a turnover of Rs 79.93 crore.
The defence stock has climbed 128% in a year and risen 310% in two years. Garden Reach Shipbuilders stock has a one-year beta of 1.8, indicating very high volatility during the period.
Shares of Garden Reach Shipbuilders fell to their 52-week low of Rs 744 on March 20, 2024 and hit a 52 week high of Rs 2834.60 on July 5, 2024.
Shiju Koothupalakkal, Technical Analyst, PL Capital said, "GRSE stock has indicated a strong bullish candle formation on the daily chart moving past the significant 50EMA at Rs 1425 level and also has given a channel (descending) breakout at Rs 1490 level, to indicate strength and has much scope for upward movement in the coming days. With the RSI showing strength, we can expect further targets of Rs 1860 level and thereafter, with parameters sustained, can expect for next higher targets of Rs 1980 and Rs 2120 levels. As of now, the 100 period MA at Rs 1520 can be kept as the stop loss level from current rate."
Osho Krishan, Senior Analyst - Technical & Derivatives, Angel One said, "GRSE has experienced a significant price increase this month, rising over 35%. The stock is currently trading near the 200-day simple moving average (DSMA), which coincides with the 50% Fibonacci retracement level from the vertical rally that took place between the lows of 668 in March 2024 and the lifetime highs of Rs 2814. The outlook for the stock has turned bullish; however, following the recent surge, the potential for a brief pullback should not be overlooked. On the technical side, support is expected around the Rs 1500-1480 range, which aligns with the 61.80% Fibonacci retracement level. Conversely, if the stock sustains buying momentum above Rs 1750, it could drive the price toward the Rs 1990-2000 range in the short to medium term." Mandar Bhojane, Equity Research Analyst, Choice Broking said, "GRSE stock has witnessed a strong breakout from a falling wedge pattern, signaling a potential trend reversal after a prolonged consolidation phase. The stock had been in a downtrend for several months, forming lower highs and lower lows. However, the recent price surge suggests renewed bullish momentum. On the upside, resistance is observed in the Rs 1,800 - Rs 2,000 range. Conversely, immediate support is positioned at Rs 1,640, with a suggested stop-loss at ?1,550 to mitigate downside risk.
Bhojane feels that GRSE presents a promising buying opportunity, with potential upside toward Rs 2,200 based on technical analysis and prevailing market conditions. "However, traders should implement proper risk management strategies to protect against potential market reversals," added Bhojane.
Jigar S Patel from Anand Rathi said, "Support will be at Rs 1645 and resistance at Rs 1748. A decisive move above the Rs 1748 level may trigger a further upside to Rs 1800. The expected trading range will be between Rs 1600 and Rs 1750 for the short-term."
Amol Athawale, VP-technical Research, Kotak Securities said," After a short-term correction, it found support near Rs 1300 and bounced back sharply. On the weekly charts, it has formed a long bullish candle and is currently trading comfortably above the 20-day and 50-day Simple Moving Averages (SMAs), which is largely positive. We believe that the short-term outlook for the stock is bullish but overbought; therefore, we could see a range-bound activity in the near future."
Athawale suggested that Rs 1800 to Rs 1850 would act as key resistance area, while Rs 1600 and Rs 1575 could serve as key support zones for the bulls. "However, if the stock falls below 1575, the uptrend would become vulnerable," he added.
In terms of technicals, the relative strength index (RSI) of Garden Reach Shipbuilders stood at 69.5, signaling it's trading neither in the overbought nor in the oversold zone.
Garden Reach Shipbuilders& Engineers is mainly engaged in the construction of warships.