Kalyan Jewellers shares tank 6% after hitting one-year high; time to book profit?

Shares of Kalyan Jewellers India Ltd fell sharply in Tuesday's trade. The counter witnessed profit booking today after hitting their 52-week high of Rs 187.55 (intraday) in the previous session. It fell 5.58 per cent to hit a day low of Rs 171.05. Around 4.65 lakh shares changed hands today on BSE, which was lower than the two-week average volume of 9.62 lakh shares. Turnover on the counter stood at Rs 8.13 crore, commanding a market capitalisation (m-cap) of Rs 17,804.47 crore. The stock has given multibagger returns in the past one year, rallying around 165 per cent.

In June 2023 quarter, the jewellery maker said its consolidated revenue rose 31 per cent on a year-on-year (YoY) basis. Kalyan Jewellers said its India operations grew 34 per cent. It also said gross margin, at the showroom level, improved YoY and was broadly in line with the prior quarter.

On technical setup, support on the counter could be seen at Rs 170, followed by Rs 164, Rs 160 and Rs 155 levels.

Osho Krishan, Senior Analyst, Technical & Derivative Research at Angel One, said, "Kalyan Jewellers has seen a magnificent move in the current financial year, wherein it soared over 70 per cent to clock new highs. Post such a stellar run, the counter has entered the overbought region, and the possibility of profit booking should not be ruled out in the counter. Strong support is placed around the Rs 160-155 zone and any cool-off towards the same is considered a re-entry point from a short to medium-term time frame."

Vaishali Parekh, Vice-President - Technical Research at Prabhudas Lilladher, said, "The stock has raced to Rs 187 zone from Rs 110 within a short span of time and has found resistance near the Rs 190 zone to witness some profit booking. The near-term support is visible near Rs 164 level. A decisive breach above Rs 190 level would be required to carry on the momentum further to anticipate for next targets of Rs 220-230."

AR Ramachandran from Tips2trades said, "Kalyan Jewellers is bearish and overbought on the daily charts with strong resistance at Rs 183. A daily close below support of Rs 170 could lead to a target of Rs 142 in the near term."

The counter's 14-day relative strength index (RSI) came at 69.79. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-earnings (P/E) ratio of 47.87 against a price-to-book (P/B) value of 5.09. The scrip has a one-year beta of 1.29, indicating high volatility.

Meanwhile, Indian equity benchmarks touched their fresh lifetime highs today. The 30-share BSE Sensex pack breached 67,000 level for the first time, while the broader NSE Nifty index topped the 19,800 mark.

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