KIOCL shares rally 44% in just two sessions; multibagger stock trading in overbought zone

Shares of KIOCL Ltd continued their strong upward move for the second straight session in Tuesday's trade. The stock soared 20 per cent to hit its one-year high price of Rs 476.40. It has gained 43.99 per cent in two days. The multibagger counter has zoomed 131.88 per cent in last six months and 112.58 per cent on a year-to-date (YTD) basis. The company has recently informed exchanges that operations at its Mangalore Pellet plant restarted from October 14, 2023.

On technical setup, analysts said that the stock largely looked 'overbought'. Support on the counter could be seen at Rs 424-440 levels.

Ganesh Dongre, Senior Manager - Technical Research Analyst, Anand Rathi Shares and Stock Brokers, said, "The stock has already seen more than 50 per cent returns in the last few weeks. The stock is in overbought zone. Currently, we will advise booking profit at the current juncture."

AR Ramachandran from Tips2trades said, "KIOCL looks bullish but also extremely overbought on daily charts with next resistance at Rs 500. A daily close below support of Rs 424 could lead to target of Rs 318 in the near term."

Vaishali Parekh, Vice-President - Technical Research at Prabhudas Lilladher, said, "The stock has indicated a strong spurt in the last two sessions. Indicators are racing towards the overbought zone and some cooling off can't be ruled out with profit booking anticipated. The next target visible is around Rs 490-505 levels while the near-term support would be at Rs 440 zone."

DRS Finvest founder Ravi Singh said one can buy the stock for a target price of Rs 550, keeping stop loss placed at Rs 450.

The counter was trading higher than the 5-day, 10-, 20-, 30-, 50-, 100-, 150- and 200-day simple moving averages (SMAs). The counter's 14-day relative strength index (RSI) came at 82.13. 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 215.56 against a price-to-book (P/B) value of 12.05.

The scrip has a one-year beta of 0.73, indicating low volatility.

KIOCL, formerly known as Kudremukh Iron Ore Company Ltd, is a flagship company under the Ministry of Steel.

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

 

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