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Aurobindo Pharma Technical Analysis #47: Sell | Target Rs 730 | Arijit Banerjee

OUR RECOMMENDATION

CMP#799.3
IdeaSELL
Sell Range810 – 790
Target730 – 710
StopLoss*740
Duration20 – 25 Trading Sessions
Potential Return^9 – 11%
CMP#IdeaSell RangeTargetStopLoss*DurationPotential Return^
799.3SELL810 – 790730 – 71074020 – 25 Trading Sessions9 – 11%

# CMP on May 02, 2019
* Maintain recommended StopLoss by daily closing basis.
   Once 1st target hit, reset StopLoss at 765.
^ The returns are calculated based on CMP#

COMPANY OVERVIEW

Incorporated in 26th December 1986, this generic drug manufacturing company is developing, manufacturing and marketing 7 major product areas encompassing Antibiotics, Anti-Retro Virals, CVS, CNS, Gastroenterologicals, Anti-Allergics and Anti-Diabetics. The vast majority of the company’s sales are generated in India, followed by the United States and globally in over 150 countries. In Q3FY19, the company has reported Profit After Tax at Rs 709.64 crore vs Rs 594.75 crore YOY. The consolidated revenue rose at Rs 5,270 crore as against 4336 crore the year-ago period.

Stock Data
NSE CodeAUROPHARMA
Sectoral IndexNifty Pharma
52W High838
52W Low527
Face Value1
Relative Performance_Aurobindo Pharma vs Nifty Pharma Index

TECHNICAL OBSERVATIONS (WEEKLY)

  • The stock price has been moving in a larger sideways range in the last few months and is showing a lack of strength to sustain any directional move during this period.
  • In this rangebound move as the price has placed near the upper end of a sideways range, we expect that price will fall further.
  • Attached weekly timeframe chart of Aurobindo Pharma Ltd is signalling that the stock price was making an attempt of a false upside breakout in last week.
Aurobindo Pharma Weekly Chart
Aurobindo Pharma Weekly Chart

TECHNICAL OBSERVATIONS (DAILY)

  • A Bearish Harami was found in the last 2 days indicates bullish trend may be reversing and it may be good time to enter into a short position.
  • Price is now closed below the bearish harami pattern, which confirms the validity of the same.
Aurobindo Pharma Daily Chart
Aurobindo Pharma Daily Chart

MONEY MANAGEMENT AND TRADING RULES

1)  It’s advisable not to enter/exit beyond the recommended range.
2)  Strictly follow the StopLoss as mentioned. Honour it.
3)  Use trailing StopLoss to retain profits.
4)  Diversify trading capital into our other technical recommendations.
5)  Risk only the money what you can afford to lose. Hedge accordingly.

ANALYST SUMMARY

The research analysis is prepared by Arijit Banerjee, CMT, CFTe. He is a veteran trader and an active investor having in-depth knowledge in financial market research, advanced technical analysis, market cycle, algorithmic trading and portfolio management. Arijit is a Chartered Market Technician (CMT) accredited by CMT Association USA, the leading global authority of Technical Analysis and has been honoured by Certified Financial Technician (CFTe) from the International Federation of Technical Analysts, USA. SEBI, the regulatory body of Indian financial market also recognizes him as a Research Analyst (INH300006582).

Disclosure

The views expressed herein are based solely on information available publicly/internal data/other sources believed to be reliable, but is not necessarily all-inclusive and is not guaranteed as to accuracy. The recommendations provided herein is solely for informational purposes and are not intended to be and must not be taken alone as the basis for an investment/trading decision. Trading and investing are subject to market risk and the securities discussed and opinions expressed herein may not be suitable for all investors. To read the full disclosure, please click here.

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