Stocks to Watch - Vodafone Idea - Shares up 4%; analyst revises trading targets, says stock looks positive on charts

Stocks in Focus – Vodafone Idea – Amid positive commentary coming from Vodafone Idea Limited on a regular basis, the stocks have seen a sharp rebound. Today, Zee Business in its exclusive report, said that the parent company Vodafone Plc could invest Rs 5000-7000 cr in a month’s time. 

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Also Read: Relief for Vodafone Idea! Promoter-led funding coming soon in company, say sources; stock up 5% – What investors should know    

The stock hit its all-time low of Rs 4.55 on the NSE on 5 August 2021. However, the trigger was the 15 September reforms undertaken by the Government to turn around the telecom sector. The Government not only rationalised the definition of Adjusted Gross Revenues (AGR), but also allowed telecom companies to avail a moratorium on payment of AGR dues for 4 years. The moratorium kicks-off from 1 October. 

Also Read: BIG REFORMS! Modi government rationalises AGR, interest, penalty, interest on penalty for telecom companies 

Vodafone Idea shares were up over 4 per cent at 1:45 pm and were trading at Rs 11.70 on the NSE on Thursday hitting an intraday high of Rs 12.10. 

Analyst Nilesh Jain said that the stock is looking positive on the technical charts. He said that VI shares have seen a pennant breakout and is now placed well for an upside. He had previously recommended a hold on this stock for existing investors for levels up to Rs 12-12.50, anticipating a pull back. He is Assistant Vice President (AVP), Equity Research Technical and Derivatives at Centrum Broking.  

The technical analyst had said that the levels around Rs 12 were crucial and would suggest a pull back. He maintains that price target. 

The AVP has also revised the price target to Rs 13.50. But the targets are only for aggressive traders and advised any investment calls in this stock. The traders must stick to strict stop loss, he further said. 

His views are based on the technical analysis of the stock and not on the basis of fundamental analysis. Jain said that, the current fundamentals do not inspire confidence. However, the indications from top management have created a lot of positivity around this stock, he added. 

The stock has been on a positive rally over the past two trading sessions, including today. In the last 6-7 trading sessions, the stock has been on a gaining spree, barring some occasions. Jain had said that the stock was looking strong on chart, despite these corrections. 

The telecom sector reforms has acted as a big trigger for the Vodafone Idea shares. The Vodafone Idea share prices jumped by almost 22 per cent on the intraday basis on 16 September. 

The 52-week high of this stock is Rs 13.80 which this stock achieved on 15 January 2021.   

Jain said that his bet is still on Bharti Airtel shares. Bharti Airtel shares were trading down 0.5 per cent on the NSE around this time at Rs 692.70. 

(Disclaimer: The views/suggestions/advices 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.)