Stock Watch: Can IDFC break the 13-year jinx?

Although IDFC Ltd is yet to reveal its Q2 FY22 results, its Q1 FY22 results were not so exciting. On a consolidated basis, IDFC Ltd reported a total income of Rs 111.6 crore in Q1 FY22 as compared to Rs 104 crore in Q1 FY21, showing growth of seven per cent. But it reported a net loss of Rs -410.3 crore in the quarter ending of June 2021 as against Rs -26.3 crore in the same quarter last year. However, in Q4 FY21 it posted a net profit of Rs 41.1 crore.

That being said, the stock has been moving in a southward direction maintaining the channel pattern for the past 13 years. At present, it is consolidating near the upper side of the channel with increased volumes.

Above is the monthly chart of IDFC Ltd.

Its Relative Strength Index (RSI) is hovering around 61 levels, which is above its 20-Month Exponential Moving Average (EMA) of 55. Its RSI has already given a multi-year breakout on monthly basis. This depicts strength towards the upside. On the other hand, the Rate of Change (ROC) is telling a different story as it is declining since February 2021.

So, would IDFC limited be giving a multi-year breakout? At this point deciding in anticipation can hurt your wealth wallet. So, it is advisable to just observe the price movement and wait for the stock to give a multi-year breakout.

At the time of writing, the stock was trading at 58.35. Today the stock opened at 57.20 while making a high and low of 58.90 and 56.35, respectively.

IDFC Ltd is a Non-Banking Finance Company (NBFC) that operates as an Infrastructure Finance Company. However, in April 2014, it received approval from the Reserve Bank of India (RBI) to set up a private sector bank. Therefore, from October 1, 2015, they are operating as an NBFC - Investment Company.