ICICI Securities bullish on this PSU fertiliser stock, sees upside in 3 months
Premium- Within PSU fertilisers, the brokerage house said it remains constructive on Rashtriya Chemical & Fertilizer
The Nifty PSE index remains in a strong uptrend forming a higher high low in all time frames and is on the cusp of generating a breakout above multi-year highs since 2017 indicating a structural turnaround, highlighted domestic brokerage and research firm ICICI Securities.
Within PSU fertilisers, the brokerage house said it remains constructive on Rashtriya Chemical & Fertilizer (RCF) as the fertiliser stock has generated a breakout above the multiyear falling supply line joining the highs of CY10 ( ₹132) and CY18 ( ₹111) signalling a structural turnaround.
“The stock is also on the cusp of generating a breakout above the last 18 months range ( ₹104-66), thus offering a fresh entry opportunity. The base of the recent consolidation is placed at the 20 month’s EMA (currently placed at | 82) signalling an overall positive price structure," the note stated.
The brokerage expects the stock to maintain positive bias and head towards ₹117 levels (target price), with a Buy rating and has a stop loss of ₹91 and time frame of around three months, in the 123.6% external retracement of the recent breather ( ₹112-71). Monthly MACD is in uptrend and is seen rebounding taking support at its nine period’s average, thus validating positive bias, it added.
Rashtriya Chemicals and Fertilizers Limited (RCFL) is a leading fertilizers and chemicals manufacturing company with about 75% of its equity held by the Government of India. The company has been accorded the coveted ‘Miniratna’ status in 1997. It has two operating units, one at Trombay in Mumbai and the other at Thal, Raigad district. RCF manufactures Urea, Complex Fertilizers, Bio-fertilizers, Micro-nutrients, water soluble fertilizers, soil conditioners and a wide range of Industrial Chemicals.
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