Vardhman Textiles shares jump 10% to hit one-year high; is more steam left?

Shares of Vardhman Textiles Ltd rose sharply in Wednesday's trading session. The stock surged 9.81 per cent to hit a 52-week high of Rs 422 over its previous close of Rs 384.30. At today's high price of Rs 422, the scrip has gained 56.30 per cent from its one-year low of Rs 270, a level seen on March 27, 2023.

On BSE, around 1.28 lakh shares changed hands today at the time of writing this story. The figure was way more than the two-week average volume of 7,725 shares. Turnover on the counter came at Rs 5.26 crore, commanding a market capitalisation (m-cap) of Rs 12,002.20 crore.

On technical setup, the counter was last seen trading higher than the 5-day, 10-, 20-, 30-, 50-, 100-, 150-, 200-day simple moving averages (SMAs). The stock's 14-day relative strength index (RSI) came at 71.81. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-equity (P/E) ratio of 22.18 against a price-to-book (P/B) value of 1.30.

"On daily and weekly charts, the scrip has seen a bullish reversal pattern around Rs 350–360 levels. A short-term bullish engulfing pattern has been formed. Traders can buy this stock with a stop loss of Rs 370 for target prices of Rs 450–460," said Ganesh Dongre, Senior Manager - Technical Research Analyst, Anand Rathi Shares and Stock Brokers.

"The stock is looking strong on charts. Expected near term target would be Rs 430, keeping stop loss placed at Rs 410," said DRS Finvest founder Ravi Singh.

"The stock is bullish but also overbought on daily charts with next resistance at Rs 464. Investors should book profits at current levels as a daily close below support of Rs 389 could lead to Rs 345 in the near term," said AR Ramachandran from Tips2trades.

The scrip has an analyst target price of Rs 386, Trendlyne data showed, suggesting a potential downside of 7 per cent in a year. It has a one-year beta of 0.2, indicating low volatility on the counter.

(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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