IRFC shares continued their impressive rally on Tuesday (September 5) as well. Shares of IRFC jumped over 13% to hit a fresh 52-week high of Rs 75.70. In the last five trading sessions, IRFC share price has jumped around 42%. With today's surge, IRFC's market capitalisation has surged past Rs 90,000 crore. At current levels, the stock is more valuable than IRCTC
IRFC topped the volume chart on NSE today. The stock surged to new highs as 17,45,74,275 shares worth Rs 1,269 crore changed hands on the counter within the first 20 minutes of trade. According to market expert Ravi Singh, railway stocks are in the upward trend after the Ministry of Railways sought Cabinet approval for a Rs 5.25 lakh crore investment program during 2024-2031 to improve rail connectivity to mining areas, cement plants, and consumption points, based on the PM Gati Shakti National Master Plan
The stock of IRFC has doubled investors' money this year having risen 117% on a year-to-date basis. In the last six months, the stock has zoomed around 150%. In the last one year, IRFC share price has rallied by a massive 200%. IRFC was listed in January 2021 at a market capitalisation of Rs 32,000 crore. The stock barely moved in the first two years of listing and remained at around Rs 26, its IPO price. It has now rallied past Rs 75 and Rs 90,000 crore in m-cap
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In terms of technicals, the relative strength index (RSI) of the stock stands at 89.1, signaling the stock is strongly overbought. IRFC has a one-year beta of 1.06 indicating high volatility. The shares are trading higher than the 5-day, 10-day, 20-day, 50-day, 100-day, 200-day moving averages. According to Trendlyne data, the stock has a price-to-earning (PE) ratio of 14.8, lower than its sector PE ratio of 24.4
On technical setup, IRFC is showing strength on daily and weekly charts and the momentum indicators suggesting a strong move ahead to up to Rs 80, as per analysts. Despite the surge seen in IRFC stock price recently, the stock does not have major analyst coverage, nor does any major mutual fund have a stake greater than 1%. As per some market experts, IRFC has a stable business, and having an NPA is out of the question. However, since the return has already doubled, investors may look to book 50–60% of profit
"IRFC stock price is overbought on the daily charts. Investors should be booking profits at current levels as a close below support of Rs 61.5 could lead to target of Rs 48.85 in the near term," AR Ramachandran from Tips2trades told Business Today. Meanwhile, Vaibhav Kaushik, Research Analyst at GCL Broking said, "The counter is showing continuous strength. After a breakout above Rs 50, it is ready to become a three-digit stock very soon. Keep stop loss placed at Rs 49 and every dip is buying opportunity for a target price of 101."
"The counter has seen a volume-based breakout around Rs 51-odd level and continued its upward march. As far as levels are concerned, the zone of Rs 51 is likely to act as strong support, before which the Rs 58-56 zone could cushion any blip. On the flip side, till the counter is able to sustain above the support zones, it is likely to trade with a positive bias. It could continue its march in uncharted territory, but at the same time, one needs to avoid being complacent and have a pragmatic approach in the counter," said Osho Krishan, Senior Analyst, Technical & Derivative Research at Angel One
Meanwhile, other railway stocks have performed well because of heavy buying. Shares of Indian Railway Catering and Tourism Corporation (IRCTC) have rallied around 10% YTD. Shares of RVNL have doubled investors' money so far this year, logging a YTD gain of around 130%. IRCON International share price has also jumped 117% so far in 2023. As per market experts, the Rs 5.25 lakh crore investment plan a positive development and it will have medium to long term impact on railway stocks
Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Business Today. Investors should consult their financial advisors before taking any position