Should investors take profits off the table in this red-hot stock after a vertical rise? Read to know more!

resr 5paisa Research Team 10th December 2022 - 05:24 pm
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Historically we have seen whenever the stock’s RSI inches close to the 91-94 mark, it witnesses profit booking.

Olectra Greentech Ltd (OGL), a group company of MEIL is a pioneer in electric bus manufacturing and insulators in India. With this endeavour, OGL has been a part of building Power Transmission and distribution in India.

The stock has registered a fresh 52-week high on Monday and interestingly it is locked at the upper circuit limit at Rs 789.45 on NSE. The stock is on a roll hitting upper circuit limits frequently. The stock did touch the upper circuit on Friday as well today (Monday).

On an MTD basis, the stock is up by over 40%. And if this isn’t enough to excite you, the gains delivered by the stock on a YTD basis would certainly amaze you. The shares of Olectra Greentech Ltd are up by a staggering 481% and in the last one year, the stock price has witnessed over a 10-fold jump in its stock price. It has outperformed not only frontline indices but also the broader market. As a result, the stock has an RS (Relative Strength) rating of 98 which is great indicating the outperformance as compared to other stocks.

The stock from a technical standpoint is comfortably placed above its key moving averages and is up by 54% from its 50-DMA and 167% from the 200-DMA.

Recently, the company announced that it has been awarded an order of 100 electric buses from one of the State Transport Corporations under the FAME-II scheme of the Government of India. This order for the supply of 100 electric buses on a gross cost Contract (GCC)/OPEX model basis (for Inter-City Operations) is for a period of 12 years (Contract Period). The value of this contract is approximately Rs 250 crore.

These e-buses shall be delivered over a period of 10 months. Maintenance of these buses shall also be undertaken by the Olectra during the contract period. With this, the total order book of Olectra for electric buses against the above and earlier orders stands around 1,550 electric buses.

The 14-period RSI on the daily chart has marked a fresh high, which is positive, but its reading stands at 87.63. Historically we have seen whenever the stock’s RSI inches close to the 91-94 mark, it witnesses profit booking. Will the history repeat? Only time would tell.

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