Macrotech Developers shares down 38% from 52-week high; good time to buy?

Shares of real estate major Macrotech Developers have plunged 38 per cent from their 52-week high hit in December last year. Macrotech Developers stock, which touched a 52-week high of Rs 1,538.65 on December 1, 2021 was trading at Rs 950 on BSE today, down 38.27 per cent during the period. Macrotech Developers stock has been falling for four sessions. It touched an intraday low of Rs 938, falling 1.02 per cent from the previous close of Rs 947.75. Macrotech Developers shares are trading lower than 5-day, 20-day, 50-day, 100-day and 200-day moving averages.

Macrotech Developers shares have lost 19.41 per cent in 2022 and declined 23.5 per cent in a year. Market cap of the firm rose to Rs 45,513 crore in today's trade.

Total 764 shares of the firm changed hands amounting to a turnover of Rs 7.21 lakh on BSE. Similarly, the BSE real estate index has slumped 7.36 per cent or 282 points from 3,829 (December 1 2021) till date. The index was trading 12 points higher at 3,540 today. However, it has lost 20.69 per cent from its 52-week high of 4,464 hit on September 9 last year.  

In Q2 of this fiscal, Macrotech Developers reported a net loss of Rs 933 crore in Q2 due to provisions made for loan given to its British arm for development of projects. Net profit stood at Rs 223.36 crore in the year-ago period. Profit (excluding exceptional item and forex) came at Rs 367 crore, up 28 per cent year-on-year. Total income also fell to Rs 1,761.23 crore in Q2 from Rs 2,137.76 crore in the corresponding period of the previous year. Macrotech suffered a loss because of an exceptional item of Rs 1,177 crore.

Macrotech Developers, which sells its properties under the Lodha brand, is one of the leading real estate developers in the country.

Here's a look at what analysts said on the prospects of the Macrotech Developers stock post the recent correction.

Om Mehra, Technical Associate, Choice Broking is bullish on the stock in the long term.  

"Macrotech Developers (Lodha) reached a level of  Rs 1,539 shortly after being listed, and led to a record high that was close to a 260 percent return. In this year, stock from higher levels has observed selling pressure, or conversely, we may say that the stock is in the distribution phase. From the Fibonacci level, the stock is trading near to its 61.8 per cent of its retrenchment. Also, from the weekly charts crucial support remains at Rs 840 level. The stock is trading below its 50 and 200 DMA on the daily chart, suggesting that it is hesitant to move higher until it crosses the 1100 mark. However, it may fluctuate between 5 and 7 percent in the short to medium term, which is preferable range bound. The next few weeks will likely see continued weakness. Indicators such as MACD and RSI indicate weakness. The real estate sector is still being held hostage by bears. Investors with a long time horizon might therefore stockpile at these prices as it is expected to produce respectable profits before the financial budget for 2023–2024, " said Mehra.  

Pavitraa Shetty from Tips2trade said, "Below average Q2FY23 results and a consistent rise in interest rates has expectedly led to a sharp fall in real estate stocks including Macrotech Developers. Technically, the stock looks bearish and investors should wait for levels close to support of 910-912 to initiate buy positions. Resistance will be at 1040." 

Tirthankar Das, Technical & Derivative Analyst, Retail, Ashika Stock Broking expects more correction in the stock of the real estate firm.  

"The share price of Macrotech developers (Lodha) has been on a sequential decline since December 2021 and a slower pace of retracement suggests inherent weakness in the stock and close below the previous swing low of August 2022 suggests further negative bias. Price remains in a downtrend forming a lower low and it is presently on the verge of a breakdown below the October low, signaling further downsides in upcoming sessions. Prices have been reacting lower after facing resistance at 20-day WEMA and a lower low on a daily time frame suggests further downward momentum. On the oscillator front too, the momentum indicator RSI is presently trading below the 50-level mark in both daily and weekly time frames reaffirming a negative bias in the stock. Going ahead, a breach of 920-925 level would be extremely negative for the stock and lower levels of 850 followed by 815 can be seen in the near term." 

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