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REC Limited Technical Analysis #9: Buy | Target Rs 113 | Arijit Banerjee

OUR RECOMMENDATION

CMP#105.65
IdeaBUY
Buy Range104 – 106
Target113 – 129
StopLoss*99
Duration25 – 30 Trading Sessions
Potential Return^7 – 22%
CMP#IdeaBuy RangeTargetStopLoss*DurationPotential Return^
105.65BUY104 – 106113 – 1299925 – 30 Trading Sessions7 – 22%

# CMP on Dec 17, 2018
* Maintain recommended StopLoss by daily closing basis.
   Once 1st target hit, reset StopLoss at 109.
^ The returns are calculated based on CMP#

COMPANY OVERVIEW

REC Ltd is a nonbanking financial company providing financial services for power generation, transmission, and distribution projects in India. It offers long term loans, medium and short term loans, debt refinance, equity and equipment finance etc. In Q3FY19 the company’s net income was improved by 30% to Rs.7286 crore and Net Profit jumped by 25.33% YOY to Rs.1764 crore.

Stock Data
NSE CodeRECLTD
Sectoral IndexNifty Financial Services
52W High165.35
52W Low89
Face Value5
Relative Performance_REC Limited vs Nifty Financial Service

TECHNICAL OBSERVATIONS (WEEKLY)

  • In the weekly chart, the stock price has placed near the lower end of a sideways channel.
  • As per historical evidence, we are expecting price to meet the upper bound of the channel.
  • Stock Price recently make Breakout above the true crucial Weekly Resistance, at 340.
REC Limited Weekly Chart
REC Limited Weekly Chart

TECHNICAL OBSERVATIONS (DAILY)

  • The closing is above 5 DMA and 10 DMA crossover on daily charts indicating the stock is ready for an up move.
REC Limited Daily Chart
REC Limited 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

This research analysis is prepared by Arijit Banerjee, CMT, CFTe. An engineering graduate developed an early interest in Trading since the age of 20. He is a Chartered Market Technician (CMT) accredited by CMT Association USA, the leading global authority of Technical Analysis and also has been honoured by Certified Financial Technician (CFTe) from the International Federation of Technical Analysts (IFTA), USA. His contribution to the market research was recognized by SEBI, the Regulatory Body of Indian financial market and given him the registration number INH300006582 as a Research Analyst. Over the years, he has gained experience in Technical Analysis with a demonstrated history of working in different asset classes. Himself as a trader, he has trained and continues training novice and experienced traders to become successful, confident and profitable in the financial market.

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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