This chemical stock jumps 67.69% in 1 month, HDFC Securities sees more upside

Investment logic

The brokerage noted “After forming a huge upward gap on Feb 14 around the Rs 984 to Rs 1110 levels, the stock price continued its northward journey for the next few sessions before show a decline.The said upside gap remains unfilled so far as per daily and weekly chart.The downside correction in mid to late February resulted in a buying opportunity on the lows and the share price rose again in late February and early March.

HDFC Securities said: “We are seeing a decisive upside break of the crucial overhead resistance of the ascending trendline at the levels of Rs 1320 (resistance according to the concept of polarity change) last week and the share price closed This is a positive indication and we can expect further upside in the coming sessions.Volume rose sharply on the upside breakout of a significant hurdle.This action indicates aggressive participation by traders. The weekly 14-period RSI broke above 75 levels, reflecting that there is strong bullish momentum in the stock price.The global chart pattern for Excel Industries Ltd indicates a long negotiation opportunity.

The brokerage's perspective on Excel Industries Ltd (EIL)

The brokerage’s perspective on Excel Industries Ltd (EIL)

HDFC Securities asserted that “the company achieved healthy revenue / PAT growth of 10.8% / 22.2% CAGR in fiscal year 2016-21 driven by its diversified industrial end-user applications; positioning strength in phosphorus, its derivatives and related chemistry and its Focus on resilient R&D Low debt level and large investment position could fund investment plans Excel Industries is focused on product lines, including pharmaceutical intermediates, polymer inputs and specialty chemicals, which are low-volume, high-value products Product additions and expansions and positive developments in the pharmaceutical and biotechnology segment of the environment would be a strong argument for reassessing the stock over the long term.”

According to the brokerage firm, “While their business fundamentals and financial profile remain strong, comments on the sustainability of the recent strong financial performance would require further detail on existing capabilities, its capacity utilization, plans for investment, key customers, final industry mix; many of these are not available on the public forum. The stock is currently trading at 14.15 x TTM EPS. We believe that given its strong track record with its product additions, focus on R&D and management’s focus on improving operational efficiency, there is room for revaluation of this stock in a shorter time horizon.”



The security was selected in the brokerage report of HDFC Securities. Investing in stocks presents a risk of financial loss. Investors should therefore exercise caution. Greynium Information Technologies, the author, and the brokerage are not responsible for any losses caused as a result of decisions based on the article.

About Leah Albert

Check Also

Meet the Next Generation Cat 789 Mining Truck

The latest generation of 193 t (rated payload) Cat 789 mining truck the main equipment …