IDFC shares delivered 8% average return in last 10 Julys; should you buy the stock?

Shares of IDFC Ltd have delivered an average of 8 per cent return in the past 10 Julys and if one goes by JM Financial, the stock can be bought at prevailing levels for a target price of Rs 132, keeping a stop loss below Rs 113 level on a closing basis. 

JM Financial said, the IDFC stock has been consolidating in a range of 105-118 levels post the decline from highs of 129 level. The stock, the domestic brokerage said, witnessed an upside breakout of the range on Tuesday, led by higher--average traded volumes. It is trading above all its key long term and short term EMAs, suggesting further strength to prevail.

"Further, we expect an expansion in the differential range of key EMAs (50-day, 100-day and 200-day) which currently stands at 2 per cent. Any such expansion is likely to be on the back of an up-move in the stock price," JM Financial said.

JM Financial said the stock has delivered positive returns in all 10 Julys, with an average return of 8 per cent.

Cumulative futures open interest in the current series has increased by 3.5 per cent with most accumulation on the long side as evident from a rise in cost of carry. Year to date, the stock has underperformed the Nifty by 15 per cent, it noted.