HCC shares plunge 15% in four sessions; here's what analysts say

Shares of Hindustan Construction Company Ltd (HCC) extending their fall for the fourth straight session in Wednesday's trade. The stock dived 7.85 per cent to hit a day low of Rs 38.25. At this price, the scrip has declined 14.67 per cent in four trading days. Despite the said drop, the multibagger counter has gained around 178 per cent in the past one year.

On technical setup, support on the counter could be seen at Rs 38, followed by Rs 35 and Rs 34 levels. And, resistance may be found above the Rs 42 zone.

Osho Krishan, Senior Research Analyst - Technical & Derivatives at Angel One, said, "HCC has been in a cool-off/profit booking phase post its stellar rally in the previous month from Rs 28 to Rs 46 levels. At present, the stock may see some more downward move. Rs 34 could be seen as the next support zone. And, sustenance above Rs 42-43 can only bring some mojo back."

AR Ramachandran from Tips2trades said the stock is bearish on daily charts with strong resistance at Rs 43.5. For HCC, a daily close below support of Rs 38 could lead to a target of Rs 31 in the near term, he added.

DRS Finvest founder Ravi Singh said, "Major resistance for HCC shares will be at Rs 48. Support is placed near the Rs 35 zone."

Bourses BSE and NSE have put the securities of HCC under the long-term ASM (Additional Surveillance Measure) framework. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors about high volatility in share prices.

The stock was trading lower than the 5-day, 10-, 20-day and 30-day simple moving averages (SMAs) but higher than the 50-day, 100-, 150-day and 200-day SMAs. The counter's 14-day relative strength index (RSI) came at 42.95. A level below 30 is defined as oversold while a value above 70 is considered overbought.

The company's stock has a price-to-equity (P/E) ratio of 30.49 against a price-to-book (P/B) value of 7.79. Earnings per share (EPS) came at 1.36 with a return on equity (RoE) of 25.56.

Currently, HCC serves the infrastructure sectors of transportation, power and water. The HCC Group, with a group turnover of around Rs 9,857 crore, comprises of HCC, HCC Infrastructure Co Ltd and Steiner AG in Switzerland.

(Disclaimer: Business Today provides stock market news for informational purposes only and that should not be construed as investment advice. Readers are encouraged to consult a qualified financial advisor before making any investment decisions.)

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