What should traders do with Jagsonpal Pharmaceuticals?
The stock of Jagsonpal Pharmaceuticals has soared nearly 10% on the bourses amid fresh buying interest.
Pharmaceutical stocks have been facing headwinds amid a lack of global demand as rising input costs and margin pressure remains a worry. However, fundamentally strong smallcap and midcap stocks have managed to make good growth in the recent past. Meanwhile, Jagsonpal Pharmaceuticals (NSE Code: JAGSNPHARM), which is a small-cap company with a market capitalization of about Rs 1,000 crore, has managed to attract investors and institutions, thanks to its growing fundamentals. During Tuesday’s trading session, the stock surged by nearly 10% backed by massive volume.
In the past 2 years, the revenue of the company has grown at a stellar rate of 19%, while net profitability remains intact. The margins have improved significantly in the past few years, which is quite positive. In its recent quarterly result, net profit grew 42% YoY to Rs 10.41 crore. Also, foreign institutions made a fresh entry into this stock in the September quarter.
Technically speaking, the stock has crossed above its 62.8% retracement level of its prior downtrend. A jump of 10% on Tuesday took stock above all its key moving averages. The volume has turned out to be multifold and above average, thus indicating strong trading activity. The 14-period daily RSI (68.14) is in the bullish zone and shows strong strength in the stock. The MACD is rising and shows strong upside potential. The OBV has jumped sharply and shows active buying interest. The elder impulse system suggests a fresh buy. The TSI and KST indicators also indicate bullishness in the stock. Overall, the stock is technically strong and is expected to trade higher in times to come.
On a YTD basis, the stock has generated over 100% returns to its shareholders despite global uncertainty. With such fundamentally sound stock being supported by bullish technical parameters, momentum traders can expect a good upside for times to come. One should keep a close eye on this stock for upcoming trading sessions.
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DisclaimerInvestment/Trading in securities Market is subject to market risk, past performance is not a guarantee of future performance. The risk of loss in trading and investment in Securities markets including Equites and Derivatives can be substantial.
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