RVNL soars 10% this week; Are the fortunes turning in the favour of investors?

RVNL soars 10% this week; Are the fortunes turning in the favour of investors?

Indian Market
by 5paisa Research Team Last Updated: 2022-10-25T11:59:34+05:30

RVNL jumped 10% during Diwali week and registered a cup pattern breakout.

The Indian indices are trading weak amidst volatility on Tuesday, with stock-specific action in focus. Meanwhile, the stock of Rail Vikas Nigam Ltd (NSE Code: RVNL) jumped over 6% on Tuesday to become the top trending stock from the Nifty 500 universe. Interestingly, the stock has already soared nearly 10% this week amid strong buying sentiment. It has registered a 27-week cup pattern breakout backed by massive volumes. Such a breakout is considered strongly bullish for the medium to long term and shows positivity. The stock currently trades near its 52-week high level.

For nearly 20 months, the stock has been consolidating in a broader range and has looked directionless over the long term. However, the sentiment is turning positive as the stock witnessed a rise in volume for the fourth consecutive month, and with a such strong breakout, investors can expect the stock to outperform the market in times to come. Technically, it possesses strong strength as the 14-period daily RSI (67.58) is strongly bullish. The MACD has indicated a bullish crossover on the daily timeframe. The OBV is at its peak and shows strong strength from a volume perspective. All the key moving averages are in an uptrend and thus, one can expect the stock to remain positive for the medium term.

In its recent quarterly earnings, the company posted a 20% YoY jump in net sales while net profit stood at Rs 297 crore, up 28% YoY. On a YTD basis, the stock has 14% and has outperformed most of its peers.

Currently, the RVNL share price trades at Rs 40 level. Long-term investors as well as momentum traders can track this stock for upcoming trading sessions.

RVNL functions as an extended arm of the Ministry of Railways and empowers to act as an Umbrella SPV to undertake project development, resource mobilization etc. directly or by creating project-specific SPVs.


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