This banking stock quadrupled investor wealth in two years; here are fresh price targets

Shares of South Indian Bank have risen 290% in the last two years. South Indian Bank stock ended at Rs 7.2 on May 6 , 2022 on BSE. It closed at Rs 28.08 in the current trading session, quadrupling investor wealth in two years. The banking stock hit a record high of Rs 36.91 on February 2, 2024 and fell to a 52 week low of Rs 14.64 on May 10, 2023. In comparison, the BSE small cap index surged 72.35% during the period. The benchmark banking index, Nifty Bank rose 41.35% in two years.

However, South Indian Bank shares saw negative investor sentiment in the current trading session. It closed 2.47% lower at Rs 28.08 on BSE.

Earlier, the stock opened higher at Rs 29.28. Total 40.16 lakh shares of the firm changed hands amounting to a turnover of Rs 11.33 crore on BSE. Market cap of the bank stood at Rs 7345.52 crore on BSE.

South Indian Bank shares have a beta of 0.9, indicating low volatility in a year. The stock has gained 88% in a year and risen 14% in 2024.

Shiju Koothupalakkal - Technical Research Analyst at Prabhudas Lilladher said, "The stock has slipped from  Rs 31.80 level with profit booking witnessed and has got the next support of  Rs 27.50 of the rising trendline zone where it can sustain failing which the bias would turn weak with next support positioned at Rs 25.30 zone. From current rate, for the bias to improve, a move past Rs 30 level is necessary to establish conviction and thereafter, anticipate for further rise."

Ganesh Dongre, Senior Manager - Technical Research, Anand Rathi Shares said, “On the weekly chart, currently the stock has seen an overbought condition; a stiff resistance has been formed at the levels of Rs 32–33. So technically, once we cross above this resistance, only then can we see another fresh rally in this stock. Currently, support stands at Rs. 25–26. So traders should avoid this stock at the current level and wait for the support level to buy on dip.”

Ravi Singh, Market Expert said, “The stock is well placed above all the major moving averages. One can continue to hold it with a stop loss of Rs 24 with potential upside of Rs 34 in the medium term.”

Kushal Gandhi, Technical Analyst, StoxBox said, “The pattern analysis on the daily timeframe indicates that the price action is undergoing a distribution phase. The stock displays underperformance through EPS strength and relative strength compared to the 50 index. On the technical front, the zone of Rs 30.75 to Rs 31.80 acts as immediate resistance. We thus recommend avoiding South Indian Bank at the current market price.”

In terms of technicals, the relative strength index (RSI) of the South Indian Bank stock stands at 47.6, signaling it's trading neither in the overbought nor in the oversold zone. South Indian Bank shares are trading lower than the 5 day, 10 day, 20 day, 30 day, 50 day, 100 day but higher than the 150 day and 200 day moving averages.

 In Q4 of the last fiscal, the lender reported a 14 per cent fall in net profit to Rs 287.56 crore against Rs 333.89 crore during the same period in 2022-23. Operating profit slipped 23% in Q4 to Rs 433.54 crore against Rs 561.55 crore during the January to March quarter of FY23. However, net interest income in Q4 rose 2 per cent to Rs 874.67 crore in Q4 against Rs 856.18 crore in Q4 of FY23