Rallis India share price surges 14% to hit 52-week high; should you buy the stock? Here's what experts say

Rallis India share price vaulted as much as 14 per cent to hit its fresh 52-week high of ₹320.95 in intraday trade on BSE on Monday, June 10, in an otherwise lacklustre market. Rallis India share price opened at ₹286.70 against its previous close of ₹281.85 and surged 13.9 per cent to hit its 52-week high level. Around 1:25 pm, Rallis India stock traded 12.3 per cent higher at ₹316.50 apiece on BSE, while the equity benchmark Sensex was 46 points, or 0.06 per cent, up at 76,739.

Rallis India shares have been in the green for the last four consecutive sessions. Taking today's high into consideration, the stock has jumped 25 per cent in June so far while the Sensex has gained 4 per cent in the same period.

Also Read: Stocks to buy: Tech Mahindra, Tata Motors, L&T among 9 stocks that may rise 6-15% in the next 3-4 weeks, say analysts

The stock hit its 52-week low of ₹191.50 on BSE on June 9 last year, and at the market price of ₹320.95, it has surged 68 per cent from that level.

Should you buy the stock?

Today's sharp gain in the stock followed the breakout of the rounding bottom pattern on the daily chart along with significant volume. Technical experts expect the stock to rise to the level of ₹400 in the near future.

"The overall trend for Rallis is bullish, with confluence from various technical indicators reinforcing the optimistic outlook. Given these signals, there is potential for the stock to achieve a target price of ₹380 & ₹400 in the near term," said Mandar Bhojane, an equity research analyst at Choice Broking.

Also Read: Nifty 50 can add 1,200 points in June, says Nirmal Bang; lists 2 technical and 2 fundamental stock picks

Bhojane advises buying the stock on dips, particularly around ₹294, with a stop loss at ₹270.

Bhojane pointed out that the Relative Strength Index (RSI) stands at 76.7 and is on an upward trend, signifying a significant surge in buying momentum.

"Both RSI and Stochastic RSI in the overbought region suggest that positional traders may consider holding their positions, implementing a trailing stop loss," said Bhojane.

Also Read: Stocks to buy: Federal Bank, Neogen Chemicals among top four stock picks by Kotak Equities for June

Santosh Meena, the head of research at Swastika Investmart underscored that Rallis is gaining momentum after breaking out from a double-bottom formation on the weekly time frame.

"The pattern suggests a potential move towards the previous all-time high of ₹362.6. On the downside, ₹290 will serve as immediate support, with a cluster of moving averages around ₹270 providing a key support level," said Meena.

However, some analysts believe this could be the right time to book some profit in the stock as there are indications that the stock may see a trend reversal.

Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers, said investors should be cautious because the stock is nearing the completion of a bearish bat pattern, specifically around the price range of ₹330-335.

"The bearish bat pattern, a technical chart pattern part of the harmonic patterns family, typically signals a potential reversal from an uptrend to a downtrend once the price reaches the designated pattern completion zone. Given this context, it is prudent for investors to consider booking profits within the ₹320-340 price range to lock in gains from the recent upward momentum," said Patel.

"Initiating new long positions should be avoided due to the high risk of a downward reversal anticipated by the completion of the bearish Bat pattern," Patel said.o 

Read all market-related news here

Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.