Multibagger railway PSU stock IRFC jumps 17% in one week; What to expect in IRFC shares after technical breakout?

Indian Railway Finance Corporation shares, the multibagger railway stock, has rallied more than 17% in one week and over 22% in one month. The PSU stock has jumped over 74% year-to-date (YTD), while it has given multibagger returns of more than 411% in one year.

IRFC shares are presently at around ₹173.20 levels. On the technical front, IRFC stock is showcasing a bullish trend surpassing key moving averages of 20, 50, 100, and 200. 

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“The current price action suggests upward momentum, particularly above ₹178 levels, with anticipated targets near ₹190 and ₹205. Notably, the stock has given a breakout of a symmetrical triangle pattern, indicating a potential continuation of the upward trajectory. Furthermore, the Relative Strength Index (RSI) at 70.10 levels underscores the underlying strength of the stock, aligning with the bullish sentiment,” said Deven Mehata, Research Analyst at Choice Broking.

Mehata suggests considering buying opportunities in IRFC shares on market dips, particularly at levels around ₹161, which presents a strategic approach.

“These opportunities, supported by various technical indicators, offer potential entry points for investors seeking to capitalize on the stock’s upward momentum while managing associated risks prudently,” he said.

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However, to effectively manage risk, it is prudent to implement a stop-loss strategy below ₹158 levels, he said, adding that this precautionary measure aims to mitigate potential losses in the event of a market downturn or unexpected price fluctuation. 

“Adopting a cautious yet proactive approach, including setting appropriate stop-loss levels and capitalizing on market dips for strategic entry, can help investors navigate the current bullish trend in IRFC’s trading environment effectively,” the Choice Broking analyst added.

Meanwhile, IRFC Q4 results are scheduled to be announced on Monday, May 20.

The Board of Directors of IRFC will consider and approve audited financial results for the quarter and year ended 31st March, 2024, and may also recommend final dividend for the Financial Year 2023-24.

On Saturday, IRFC shares ended 2.61% higher at ₹173.20 apiece on the BSE.

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Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.

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Published: 18 May 2024, 12:50 PM IST