Shares of Suzlon Energy edged higher as the renewable energy solutions provider's stock has been excluded from the Stage 1 Additional Surveillance Measure (ASM) framework. The stock was earlier placed under this regulatory mechanism by the stock exchange.
Stage 1 ASM is a regulatory framework used by Indian stock exchanges to monitor and control unusual price movements or volatility in stocks. When a stock is placed in Stage 1 ASM, it undergoes heightened scrutiny, and investors are required to meet a 100 percent margin requirement for trades.
The parameters for shortlisting securities under ASM include high-low variation, client concentration, number of price band hits, close-to-close price variation and price-earnings ratio.
The measure is designed to mitigate risks and protect market integrity by controlling speculative trading and ensuring stability. Stocks remain under ASM until they no longer exhibit the concerning behaviours or meet the criteria for removal from the framework. Suzlon has now been removed from ASM framework, reported CNBC-TV18 Awaaz.
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At 12:36 pm, Suzlon Energy shares were trading nearly a percent higher at Rs 81.65 on NSE. The stock has rallied 112 percent so far this year, more than doubling investors' money in comparison to Nifty's returns of 16 percent.
In the past 12 months, the counter has risen 216 percent while Nifty has risen 27 percent during this period.
The price behaviour of Suzlon Energy, despite exhibiting a positive upward trend, appears to be losing momentum. The relative strength index has displayed a downward trend, indicating a negative divergence in comparison to the price, according to Kushal Gandhi, Technical Analyst, StoxBox.
"The stock encountered resistance near Rs 84.30, with the price being rejected at these levels on relatively higher volume. Additionally, the stock's relative strength in comparison to Nifty has shown a decline. Consequently, it is advisable to refrain from purchasing the stock at the current market price," he said.
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