IFB Industries shares reclaim Rs 850 level, up 22% from 52-week low; time to book profit?

Shares of IFB Industries Ltd rose nearly 5 per cent on Wednesday, pausing their three-day fall. The stock settled 4.85 per cent higher at Rs 854.95 over its previous close of Rs 815.40. The scrip has lost 9.21 so far in 2023 and 10.69 per cent in a year. Considering today's closing level of Rs 854.95, IFB Industries has gained 22.49 per cent from its 52-week low of Rs 698, hit on March 29, 2023. That said, the stock has declined 26.68 per cent from its one-year high of Rs 1,166, a level seen on November 22 last year.

Analysts largely remained mixed on the counter. Some suggested more upside potential in the near term, while one of the analysts recommended booking profits at current levels. Support on the counter could be seen at Rs 780, followed by Rs 760, Rs 750 and Rs 740.

"IFB's sales have improved. Also, summer months are the peak business season, supporting the upward move on the counter," AK Prabhakar, Head of Capital, IDBI Capital.

"Rs 820-800 levels are likely to provide a cushion, while strong support lies around Rs 780. On the flip side, strong resistance is placed around Rs 920," said Osho Krishan, Senior Analyst - Technical & Derivative Research at Angel One.

"Since the last 2 two weeks, IFB has seen massive buying interest from lower levels which is a positive sign. One can buy in the range of Rs 875-885 with a target of Rs 950 and the stop-loss would be at Rs 830," said Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers.

"IFB industries is bullish on the daily charts but also overbought with strong resistance at Rs 920. Investors should book profits at current levels and wait for a dip near support of Rs 740-760 to initiate fresh buy positions," said AR Ramachandran from Tips2trades.

"The stock is in structurally up trend after making a low of around Rs 700 level. The historical price action in the stock reflects that any meaningful development in the stock attracts market participants, which helps the scrip to continue its uptrend. After some minor corrections, the immediate target in IFB Industries' stock is placed around Rs 950 in the coming trading sessions," Ravi Singh, Vice-President and Head of Research at Share India.

"High metal costs over the last year have harmed the company's margins. Rising interest rates will have an impact on demand. So long-term investors should purchase on dips around the Rs 750 level," said Ravi Singhal, CEO at GCL Broking.

The stock traded higher than the 5-day, 20- and 50-day moving averages but lower than the 100-day and 200-day moving averages. The counter's 14-day relative strength index (RSI) came at 65.16. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a negative price-to-equity (P/E) ratio of 885.76. It has a price-to-book (P/B) value of 4.99.

IFB Industries has an average target price of Rs 1,074.39, Trendlyne data showed, suggesting a potential upside of 25.18 per cent. The scrip has a one-year beta of 0.41, indicating low volatility.

Meanwhile, Indian equity indices extended their fall for the third straight session today, dragged by technology and state-owned lenders.

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