Technical Check: 60% in a year! This manufacturing company eyes fresh 52-week high in next 6 months; time to buy the dip?

Timken India Ltd stock has rallied 60 percent in a year compared to 15 percent upside seen in the Nifty50 in the same period.

The stock of this engineered bearings, mechanical power transmission products company has shown resilience in the recent selloff. Timken India is up nearly 3 percent in last week and over 3.4 percent in last month compared to 2.4 and 1.8 percent percent fall in Nifty50 in the same period.

Timken India Limited (Timken) was incorporated in 1987 as Tata Timken Limited (TTL), a joint venture between Tata Iron and Steel Company (TISCO) and The Timken Company of USA, a world leader in tapered roller bearings.

It provides roller bearings which are used in locomotives, engines, wagons, passenger coaches and wheels, company data showed.

Timken India is a low beta of 0.5 (1-year) which helps it to beat market volatility and is trading well above crucial short- and long-term moving averages. The stock is trading above 30,50,100 and 200-DMA which is a positive sign.

Investors can look at buying the stock on dips as the momentum could well take Timken India towards Rs 2700 which translates into an upside of over 30 percent from Rs 2026 recorded on 28 February, suggest experts.

The company with a market capitalization of more than Rs 15000 cr hit a 52-week high of Rs 2174 on 3 December 2021 and since then the trend went sideways.

In terms of shareholding, foreign investors reduced their stake while fund managers increased their stake in Timken India for the quarter ended December.

Foreign institutional investors (FIIs) decreased holding from 2.8 percent in the September quarter to 2.66 percent recorded for the quarter ended December.

Mutual Funds increased holding from 11.65 per cent in September quarter to 12.67 per cent recorded for the quarter ended December, data from Trendlyne showed.

The recent price action in February pushed the stock above the crucial short-term moving averages of 30 and 50-DMA last week which suggests momentum is here to stay. The stock closed above 100-DMA for the first time on 15 February, data from Trendlyne showed.

The stock price started its upward move from 650 (March 20) and made a high of Rs 2,175 in December 2021 accompanied by higher bottoms and higher top formations.

“Super trend turned positive since September 2020 till date. The stock always traded above averages and never breached the 52-week average,” Bharat Gala, President - Technical Research, Ventura Securities Ltd, said.

“Recently, the stock made a high of 2108 crossing the previous two weeks high. The ROC, ADX & PVT indicators suggest a possible firm uptrend. The possible targets are 2700-2900-3200,” he said.

Gala further added that if the stock price corrects downwards the buy levels are (2045-1960)-1900- (1840-1790). Stop Loss to be observed in the trade is 1650.

(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.)