Stock below Rs 200: Mukul Agarwal’s favourite small finance bank registers a fresh breakout; don’t miss out!
The stock has scaled to a fresh 52-week high of Rs 189.25 and is currently trading even higher, up by an impressive 6.25 per cent.
In the midst of a buoyant market, the NSE benchmark Nifty50 index has confidently held above the impressive 19,700 mark, registering a commendable 0.30 per cent gain on Monday. What's particularly encouraging is that the broader markets are showing even more vigor, with the Nifty Midcap and Small-Cap indices surging by 0.76 and 0.89 per cent, respectively.
This surge in the broader markets is evident in the strong advance-decline ratio, with nearly 1400 stocks advancing against a mere 592 stocks declining. The fear gauge index has risen by 5 per cent, but it remains comfortably below the 11-mark, indicating a relatively positive sentiment among investors.
Amidst this vibrant market backdrop, one of the standout performers from the small-cap segment is Suryoday Small Finance Bank, which is attracting significant attention on Monday. The stock has scaled to a fresh 52-week high of Rs 189.25 and is currently trading even higher, up by an impressive 6.25 per cent.
The stock's recent price action reveals a compelling bullish continuation pattern known as the 'Ascending Triangle.' This consolidation phase has culminated in a robust breakout, supported by substantial trading volume. In fact, the volume in the last six trading sessions has been the highest, nearly twice the 10-day average volume, further validating the Dow Theory principle of strength in numbers and signaling a larger participation in the direction of the upward trend.
Technical indicators also underscore the stock's bullish momentum. The 14-period daily RSI has experienced a bullish crossover and entered the bullish territory, reflecting a positive trend. Additionally, the Average Directional Index (ADX), a measure of trend strength, has soared above the 40-mark, confirming a strong uptrend. The current ADX reading corroborates an upward trajectory, with the +DI (positive directional indicator) significantly outperforming the -DI (negative directional indicator) and exceeding the 30-mark, signifying robust bullish strength.
What adds to the allure of this stock is the notable fact that ace investor Mukul Mahavir Agarwal holds an impressive 2.83 per cent stake in the company, according to the latest shareholding pattern of the quarter ended June 2023. Furthermore, the small finance bank has ambitious growth targets, aiming for a 30 per cent increase in gross advances and a 35 per cent rise in deposits in FY24. The bank is also committed to achieving a commendable return on assets of 2.2 per cent and an impressive return on equity of 15 per cent.
Overall, the dynamic market conditions, along with strong technical indicators and the backing of a prominent investor, make Suryoday Small Finance Bank a captivating prospect for investors seeking growth and potential in the financial sector.
It is crucial to remember that the views and opinions expressed in this article are solely for informational purposes and do not constitute financial, investment, or any other form of advice. Investors are advised to conduct thorough research and seek guidance from professional financial advisors before making any investment decisions.