This underdog PSU Stock below Rs 100 shatters multiyear resistance, jumps 15 per cent to reach a new 52-week high!
With this, it seems it is clear that gone are the days of scepticism and resistance towards PSUs.
On Tuesday, Sensex ended the day with gains of 0.40 per cent and it recorded seventh consecutive day of higher high. In the past, a number of 7 or greater as consecutive higher high suggested an “overstretched” condition of the rally and it is followed by profit booking. History is repeating itself again and with this the tide seems to have turned, as profit booking emerged on Wednesday, resulting in a 0.35 per cent dip in the Sensex. While this may seem like bad news, there is a glimmer of hope in the broader markets. The BSE Midcap and Smallcap indices continued to outperform with a 0.34 per cent and 0.35 advance, respectively, on Wednesday.
But what's even more interesting is that a particular stock from PSU has been gaining a lot of attention from market participants, namely, Engineers India Ltd. This leading global engineering consultancy and EPC company owned by the Govt. Of India operating under the administrative control of the Ministry of Petroleum and Natural Gas (MoPNG) has seen its stock price soar as high as nearly 15 per cent in a single day, recording its highest single-day gain in many months and as a result, it has marked a fresh 52-week high.
From a technical standpoint, the stock has witnessed a breakout of multiple year consolidation pattern and what's even more impressive is that the breakout has been accompanied by high volume. As the volume recorded so far is the highest single-day volume in the last 5 months. Considering the stock has registered fresh 52-week high, it is trading above its key short- and long-term moving averages. The 14-period daily RSI is in bullish territory and inching southwards, while the daily MACD is pointing northward and sustaining above its nine-period average, thus validating a positive bias in the stock.
With this, it seems it is clear that gone are the days of scepticism and resistance towards PSUs. Owning a state or central PSU stock was once considered an embarrassing choice for investors, but times have changed. In 2023, more and more investors are keen on having a slice of PSU stocks.