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Torrent Pharma Technical Analysis #45: Sell | Target Rs 1630 | Arijit Banerjee

OUR RECOMMENDATION

CMP#1753.75
IdeaSELL
Sell Range1770 – 1740
Target1630 – 1530
StopLoss*1825
Duration20 – 25 Trading Sessions
Potential Return^7 – 13%
CMP#IdeaSell RangeTargetStopLoss*DurationPotential Return^
1753.75SELL1770 – 17401630 – 1530182520 – 25 Trading Sessions7 – 13%

# CMP on April 26, 2019
* Maintain recommended StopLoss by daily closing basis.
   Once 1st target hit, reset StopLoss at 1692.
^ The returns are calculated based on CMP#

COMPANY OVERVIEW

Founded in 1959, based in Ahmedabad India, Torrent Pharmaceuticals Limited engages in research, development, manufacturing and marketing of generic pharmaceutical formulations in India, USA, Germany, Brazil and internationally. The company offers products in cardiovascular, central nervous system, and gastro-intestinal, therapeutic, dermatology, oncology and women healthcare. The consolidated revenue rose 36 percent to Rs 1,948 crore as against the year-ago period.

Stock Data
NSE CodeTORNTPHARM
SectorNifty Pharma
52W High1962
52W Low1303.55
Face Value5
Relative Performance_Torrent Pharma vs Nifty Pharma

TECHNICAL OBSERVATIONS (WEEKLY)

  • Looking at the weekly chart, the stock has seen a spectacular rally from the bottom of around 1230 (March 2018) and hit a fresh all-time high of around 1962 (March 2019).
  • Then we witnessed a sharp 12% decline from ₹ 1962 to ₹1720 within last 4 weeks.
  • This week, the stock broke out from an upward slopping trend line from weekly charts which is a negative sign. This indicates that the stock looks set to continue the next leg of its uptrend.
Torrent Pharma Weekly Chart
Torrent Pharma Weekly Chart

TECHNICAL OBSERVATIONS (DAILY)

  • Currently, we are witnessing a neckline breakout from the Head & Shoulder pattern on the Daily chart, which is a negative sign for the stock.
  • This can be a genuine breakout as it is supported by incremental volumes.
Torrent Pharma Daily Chart
Torrent 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

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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