Momentum Pick: Tanla Platforms rallies over 200% in 1-year period – should you buy at current valuations?

Cloud-based services provider Tanla Platforms Ltd has returned investors almost 264 per cent over a 12-month period and the Year-to-Date (YTD) gains at 82.58 per cent. The stock has outperformed the BSE Sensex by 213 per cent over a 1-year period.  

The stock was trading at Rs 1246.55 and was up by Rs 60 or 5 per cent on Tuesday. The stock has corrected from its 52-week highs of Rs 1334.95 on 29 October 2021. What should the investors do with this stock – buy, avoid or hold it? Fundamental and Technical analysts give their views on it and this is what they say. 

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Tanla Platforms shares were trading above their 5-day, 20-day, 50-day, 100-day and 200-day moving averages. It was underperforming the sector by 1.18 per cent on the intraday basis. The stock was outperforming the sector by 5 per cent around 2:40 pm.  

Fundamental View – Sandeep Jain  

Tanla Platform | HOLD| Target Rs 1500    

The stock has seen a considerable high over the last 52-week travelling from a low of Rs 324.70  

Analyst Sandeep Jain said that this stock has seen significant movement and the valuations look slightly on the higher side. Existing investors can hold this stock for further upside, he said calling it a “good hold”. It is a strong candidate for Hold and must be retained for a target price of Rs 1500. 

Buy on dips is advised in a staggered way, if any fresh positions are to be made. This is one stock which consistently hits a 5 per cent circuit, which is indicative of the volatility in this stock. 

The company has seen a big turnaround since March 2020 and the company has been a top performer. It is a big platform for services like SMS and has been earning good revenues. This is a unique model and the company has no competitor, the Tradeswift Director said. The Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs) have a strong confidence in this company, he said. The FIIs hold over 13 per cent shares in the company while DIIs hold around 1.3 per cent in the company. 

The promoter holding stands over 42 per cent. 

The September quarter Profit After Tax (PAT) was highest ever at Rs 136 cr while the net sales was up 44 per cent yoy at Rs 841 cr. 

Technical Analysis – Nilesh Jain 

Tanla Platforms: Hold| LTP: Rs 1246| Target: Rs 1400| Stop Loss: Rs 1150| Upside 12% 

Reiteration Sandeep Jain’s views, technical Analyst Nilesh Jain advised making any fresh positions in this stock. He however, acknowledged that the stock was in a good momentum. The stock could test levels around Rs 1400 over a short term period, he added. One must hold it with a trailing stop loss of Rs 1150. The risk-to-reward ratio is not favourable at current levels. It can be played for a rally, he advised. 

The stock is currently trading at a Price-to-Earnings (PE) ratio of almost 37 while the Price-to-Book value is 15.50.

(Disclaimer: The views/suggestions/advises expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)