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This Jhunjhunwala stock down 32% from 52-week high: Should you buy the dip?

This Jhunjhunwala stock down 32% from 52-week high: Should you buy the dip?

Shares of Canara Bank form part of ace investor Rakesh Jhunjhunwala's portfolio. The big bull held 1.96% stake or 3.55 crore shares in the public lender at the end of March 2022 quarter.

 Ace investor Rakesh Jhunjhunwala. Canara Bank stock trades higher than 5-day moving averages but lower than 20-day, 50-day, 100-day and 200-day moving averages. Ace investor Rakesh Jhunjhunwala. Canara Bank stock trades higher than 5-day moving averages but lower than 20-day, 50-day, 100-day and 200-day moving averages.

Shares of the state-owned lender Canara Bank have lost 32 per cent from their 52-week high amid the ongoing market turmoil. The stock closed at Rs 185.95 on BSE in the previous session compared to the yearly high of Rs 272.80 hit on February 3, 2022, translating into a decline of 32 per cent during the period.

The stock forms part of ace investor Rakesh Jhunjhunwala's portfolio. The big bull held 1.96 per cent stake or 3.55 crore shares in the public lender at the end of March 2022 quarter.

The large-cap stock was trading at Rs 188.90 level today, up 1.59 per cent on BSE.

The stock trades higher than 5-day moving averages but lower than 20-day, 50-day, 100-day and 200-day moving averages.  The shares have lost 6 per cent since the beginning of this year and risen 22.37 per cent in one year.

The market cap of the bank stood at Rs 34,287 crore on BSE. Total 1.49 lakh shares changed hands amounting to a turnover of Rs 2.80 crore on BSE.

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The stock hit a 52-week low of Rs 142.10 on July 28, 2021.

In Q4 of the previous fiscal, 6,39,135 public shareholders held 37.07 per cent in the firm. One promoter held 62.93 per cent stake or 114.17 crore shares in the last quarter.

6,26.572 shareholders held 11.36 crore shares of the firm, amounting to a stake of 6.27 per cent with an individual share capital of up to Rs 2 lakh.

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296 public shareholders held 7.90 crore shares of the firm, amounting to a stake of 4.36 per cent with an individual share capital of over Rs 2 lakh.

The lender reported a 65 per cent rise in Q4 net profit. The bank reported a 65 per cent jump in its standalone net profit at Rs 1,666.222 crore for the fourth quarter ended March 31, 2022 against a net profit of Rs 1,010.87 crore in the year-ago period. Total income in the January-March period of 2021-22 rose to Rs 22,323.11 crore against Rs 21,040.63 crore in the same period of 2020-21, Canara Bank said.

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On the asset quality front, the bank's gross non-performing assets (NPAs) or bad loans fell to 7.51 per cent of the gross advances at the end of March 2022, as against 8.93 per cent at the end of March 2021.

Here's a look at what analysts said about the prospects of the stock.

Pavitraa Shetty, Co-founder & Trainer, Tips2Trades

 "Recent sharp interest rate hikes & selling in risky sectors like PSU stocks & metals has led to a fall in Canara Bank stock price. Technically, till the stock price doesn't close on the daily chart above Rs 193, the trend is bearish. Support will be at Rs 176."

Manoj Dalmia, Founder and Director, Proficient Equities

"The stock can retrace till Rs 200 and might fall till Rs 160 in the near term and any closing below Rs 160 can trigger further selling till Rs 130."

Ravi Singh, Vice President and head of Research, Share India

"Canara Bank share has been in a downtrend since a couple of trading sessions taking cues from weakness in the benchmark indices. However, the stock has immediate support around Rs 170 levels and resistance around Rs 200 levels. It may remain under pressure, possibly consolidating between Rs 180 - Rs 170 levels. Investors may take long positions between these levels for the target of 200 placings a stop loss of 160 in near term."

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