Olectra Greentech share price rises on technical breakout; Geojit upgrades stock to ‘Buy’

Olectra Greentech share price extended rally on Wednesday as the stock indicated technical breakout on the daily chart. Olectra Greentech shares gained as much as 2.6% after witnessing a sharp 4% surge in the previous trading session.

Olectra Greentech has given multibagger returns as the stock price jumped over 96% in one year and more than 741% in the past three years. Year-to-date (YTD), Olectra Greentech shares have risen over 36%.

The company’s market capitalisation has crossed ₹15,000 crore. The stock price touched a 52-week high of ₹2,222.00 on February 22, 2024, and is down nearly 18% since then.

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Technicals

After the gradual slide, Olectra Greentech stock has consolidated near the ₹1,750 - 1,800 zone for quite some time and currently has indicated a triangular pattern breakout on the daily chart moving past the important 100 period Moving Average (MA) at ₹1,815 level to improve the bias and anticipate for further rise, said Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher.

The RSI is well placed indicating a trend reversal to signal a buy and has much upside potential from current levels, she added.

With the chart looking good, the analyst suggests buying Olectra Greentech shares for upside targets of ₹2,030 and ₹2,170 in the coming days keeping the stop loss of ₹1,720.

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Fundamentals

Olectra Greentech is primarily engaged in the manufacturing of electric buses and composite polymer insulators. The company currently holds 10,969 electric bus orders, and is diligently working towards its new Greenfield EV manufacturing facility, which is operational and expects a significant ramp-up in Q2FY25, with an annual capacity outlay of 5,000 vehicles.

The company is also expanding its product line in the e-mobility segment with electric truck tippers and hydrogen bus project with the formation of a JV with BYD (Build Your Design) China for electric buses.

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Given the strong order book, capacity expansion, and scalability of multiple powertrains, Geojit Financial Services values Olectra Greentech shares at 55x FY26E earnings per share (EPS) estimates.

“We expect the government’s intention for carbon-free emissions and technological capability, coupled with its strong association with STUs, to drive future growth for the company,” said Anil R, Research Analyst at Geojit Financial Services.

The brokerage firm upgraded its rating on Olectra Greentech to ‘Buy’ from ‘Accumulate’ earlier and raised the 12-months target price to ₹2,086 per share.

At 11:55 am, Olectra Greentech shares were trading 1.28% higher at ₹1,834.00 apiece on the BSE.

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