RVNL shares slip 8% today. Where is the stock headed?

Shares of Rail Vikas Nigam Ltd (RVNL) fell sharply in Wednesday's trade in a highly volatile session. The stock dived 7.51 per cent to hit a day low of Rs 170. At this price, the stock was down 14.72 per cent from its one-year high of Rs 199.35, a level seen on September 12, 2023. Despite the mentioned fall, the multibagger scrip has rallied 202.76 per cent from its 52-week low of Rs 56.15, hit earlier on March 1 this year.

The company, in a BSE filing said, "The KRDCL-RVNL JV (joint venture) emerges as the lowest bidder for Varkala Sivagiri Railway Station – Major upgradation/redevelopment of Varkala Sivagiri Railway Station in Kerala."

The JV is between RVNL and Karnataka Road Development Corporation Limited (KRDCL), where the company has a 49 per cent stake and KRDCL has a 51 per cent share. The estimated cost of the project is Rs 123.37 crore.

On technical setup, support on the counter could be seen in the Rs 170-180 zone. An analyst mentioned that the stock may slip further if it closes below Rs 175 level. That said, RVNL is likely to witness strong resistance around its one-year high level before it eventually sees the Rs 200 mark.

Also read: RVNL shares rise 4% as firm becomes lowest bidder for Rs 543-crore Indore Metro Rail project

"RVNL is in a secular up trend, hovering well above all its major EMAs (Exponential Moving Averages) on daily charts. Looking at the chart structure, the counter seems poised to hit the Rs 200 mark in the coming period. However, a strong resistance could be seen around Rs 190-196 zone (previous swing highs). While, on the downside, a series of support could be seen from Rs 180-172-odd levels with a bullish undertone," said Osho Krishan, Senior Research Analyst - Technical & Derivatives at Angel One.

"Support will be at Rs 170 and resistance at Rs 200. Expected trading range will be between Rs 150 and Rs 220 for a month," said Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers.

"The stock may hit Rs 195 in the near term. Keep stop loss placed at Rs 178," sad DRS Finvest founder Ravi Singh.

"RVNL has strong resistance at Rs 198 level. A daily close below support of Rs 175 could lead to a drop till Rs 155 in the near term," said AR Ramachandran from Tips2trades.

As of September 2023, promoters held 72.84 per cent stake in the company.

RVNL is an executing arm of Indian Railways and works for and on behalf of the ministry to execute projects assigned to it. It works on a turnkey basis and undertakes the full cycle of project development from conceptualisation to commissioning including stages of design, preparation of estimates, calling and award of contracts, project and contract management.

(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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