Technical Check: 200% in a year! This travel company is showing strength on charts; buy on dips

Indian Railway Catering and Tourism Corporation (IRCTC) has rallied by about 200 per cent in the last 1 year compared to a 24 per cent gain seen in the Nifty50 in the same period.

The company with a market capitalization of over Rs 69,000 crore hit a 52-week high of Rs 1278 on the BSE on 19th October and then the stock turned sideways.

The stock has been trading in a tight range since November, but technical indicators suggest a bullish setup for the stock.

The possible target seen in IRCTC is close to 1200-1600 that translates into an upside of over 30 per cent from Rs 873 recorded on 10 January, suggest experts.

IRCTC has been on buyers’ radar in 2021 but soon fell off the radar after the government demanded the state-run company to share half of the convenience fee – a decision which was later reversed in a matter of days in October.

Technically, the stock is trading well above the short and long-term moving averages of 30,50,100 and 200-Days Moving Average.

The stock could consolidate in the near term but any dip towards 800-750 could be used as a buying opportunity to go long in the counter, suggest experts.

The stock price moved from 396 (June 2021) to 1279 (Oct 2021). A technical correction in the form of profit booking followed and the stock made a low of 650 on October 21.

The stock traded in a range of 750-1000 area from October to December. The Bollinger bands formed a Narrow Zone during the same period, raising the possibility of Breakouts.

“The stock attracted two sessions of good volumes with Positive Price candle suggesting buying interest in the stock. Recently the stock made a high of 888, crossing over recent swing Highs of 878,” Bharat Gala, President - Technical Research, Ventura Securities Ltd, said.

“Aroon Up/Down, Vortex & Demand Index Indicator suggest a possible up move. 200 DMA is continuously in rising Mode. The possible targets are 1200-1400-1600,” he said.

Gala further added that if the stock price corrects downwards the buy levels are (800-750). A stop loss to be observed in the trade is 630.

(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.)