The stock price of Somany Ceramics, a ceramic wall and floor tile manufacturing company, rose over 400 percent in the last year, much ahead of Nifty’s 50 percent rally in the same period.
On a year-to-date (YTD) basis as well, Somany shares have rallied more than 80 percent, compared to over 12 percent in Nifty50 in the same period, and 17 percent seen in the S&P BSE 500 Index.
After hitting a 52-week high of Rs 650 on June 21, the counter has seen consolidation and it is currently trading above all the crucial short and long-term moving averages.
Most technical indicators back the stock
According to experts, the technical setup still remains bullish and investors can create long positions at current levels or on dips for a target of Rs 978, which translates into an upside of about 60 percent from the June 30 closing price of Rs 614 on the NSE. The time horizon should be at least 6-9 months.
Somany Ceramics houses a large inventory of tiles, floor tiles, wall tiles, kitchen tiles, sanitaryware, and bath fittings.
Technically, the stock is in an uptrend and most technical indicators suggest the momentum will continue. Indicators like RSI, MACD, Stochastic, ROC are all in a bullish territory, according to data compiled by MC Technicals.
“The stock utilised the previous narrow range consolidation to climb to higher levels. The stock has given a breakout from its upward consolidation in June ’21, when it jumped by about 31 percent and rose to a fresh two-year high,” Jatin Gohil, Technical and Derivative Research Analyst, Reliance Securities, said.
“The stock is positively poised above its major moving averages. The key technical indicators on the medium term as well as long term timeframe chart are in bullish mode,” he said.
Gohil further added that this will help the stock to continue its prevailing up-trend and could lead towards its lifetime high of Rs 977.60. In case of any decline, the stock will find support around its 100-month SMA.
“Long position can be initiated now (Rs 614) and on dip towards its 20-day EMA (placed around Rs 554) for a target of Rs 978 and stop-loss of Rs 382,” recommends Gohil.Disclaimer
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