Equity Market | A Significant breakout from an inverted head and shoulder pattern for V GUARD EQ

Technical analysts at Commodity Samachar have provided an equity investment buy call for V Guard EQ. 

Owing to Q4 numbers being weak as poor sales continue in the South Indian markets, particularly in electricals and consumer durable segments, a buy call has arisen. The high-cost inventories and increased advertising on products impact profitability. 

As per reports coming from the management, a 14-15% revenue growth is expected in FY2024 as recovery in consumer durables and electricals is anticipated. 

Furthermore, Sunflame’s acquisition would help unlock synergy benefits in geography, product portfolio and channels as it is dominant in the north and west owing to its traditional channels. A successful association of V Guard could help strengthen Sunflame’s presence in the South Indian market and on e-commerce trade channels as well. 

Technical Outlook:

VGUARD EQ – Target Rs 335 | Stop Loss Rs 236 | Returns 19.64%

VGUARD EQ – Bullish

V GUARD has been consolidating for the past 108 trading sessions and has finally broken out from an Inverted head and shoulders price pattern on the weekly chart.

The price breakout has also been accompanied by a smart uptick in traded volumes. With the previous trend being a solid uptrend, we expect the stock to resume and extend the momentum further.

Other momentum oscillators along with relative strength also indicate that the current up move is here to stay. The stock is trading above the 200-Days simple moving average on the daily time frame, which is positive for the prices in the near term. Currently, RSI is reading near 70 levels, which indicates that the bullish momentum will likely continue in the near term.

Buy around Rs 280 Stop-Loss Rs 236 Target Rs 315 – Rs 335.

Duration / Holding Period – 6 Months to 1 Year.

Current PriceMarket CapStock P/EDividend Yield
₹ 283₹ 112450.93 Cr69.430.45 %
₹ 4.1422.63 %17.83 %55.8%