Tanla Platforms: Stock jumps 6% in otherwise weak day for IT shares. Where is it headed?

Shares of Tanla Platforms Ltd soared more than 6 per cent on Monday, extending their recent rebound for the fourth straight session. The stock, which slipped to its 52-week low of Rs 506.10 on March 27 this year, has settled higher in nine out of the past 11 sessions after that. Monday's sharp run came despite a steep decline in IT counters led by tier-1 IT players including Infosys and Tech Mahindra. Tanla Platforms settled 6.29 per cent higher at Rs 666.30 today over its previous close of Rs 626.85. Although this multibagger counter has declined 7.30 per cent in 2023 so far and 54.64 per cent in the last one year, it is still up 1,722.98 per cent in the last five years.

At today's closing value of Rs 666.30, the scrip traded 56.40 per cent lower from its one-year high of Rs 1,528.10, a level seen on April 21, 2022.

The company would hold a meeting to consider and approve the audited financial results for the quarter (Q4) and financial year that ended on March 31, 2023 (FY23), on April 26. It would also recommend a final dividend, if any, for FY23.

On the technical front, support on the counter could be seen at Rs Rs 600, followed by Rs 570 and Rs 560 levels, while the stock faces resistance around the Rs 700 to Rs 740 zone, one of the analysts said. The other analyst suggested buying it at around Rs 650-670 for a potential target of Rs 760, keeping a stop loss placed at Rs 615.

Osho Krishan, Senior Analyst - Technical & Derivative Research at Angel One, said, "Tanla Platforms has seen a modest recovery from the recent lows of Rs 506.10 and is currently hovering near the previous consolidation zone. The stock currently has multiple resistances, starting from the Rs 700 to Rs 740 zone, coinciding with 200-SMA (Simple Moving Average) on the daily charts. On the flip side, the immediate support hovers near Rs 600, followed by the Rs 570-560 odd zone."

Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, "For the last 7-8 months the said counter has been making the lower top and lower bottom structures which resulted in a 44 per cent cut in price. At the current juncture, it has taken out its downward-slopping trendline thus making it a lucrative buy. Additionally, Daily DMI has given a bullish cross which is hinting towards a bullish stance in the counter for the coming few weeks. 
One can buy in the range of Rs 650-670 with a target of Rs 760 and the stop-loss would be at Rs 615."

The stock traded higher than the 5-day, 20- and 50-day moving averages but lower than the 100-day and 200-day moving averages. The counter's 14-day relative strength index (RSI) came at 67.24. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-equity (P/E) ratio of 45.22.

Yet, Tanla Platforms has an average target price of Rs 1,202.33, Trendlyne data showed, suggesting a potential upside of 80.31 per cent. The scrip has a one-year beta of 1.26, indicating high volatility.

The company (formerly Known as Tanla Solutions) offers an application-to-person service (A2P) messaging platform globally. Its range of services includes product development and implementation in the wireless telephony industry, aggregator services and offshore development services. Its segments include Mobile VAS & Software Development, and Property Development.

Meanwhile, Indian equity benchmarks fell sharply today, halting their nine-day winning run. The 30-share BSE Sensex pack dived 520 points or 0.86 per cent to close at 59,911, while the broader NSE Nifty index moved 121 points or 0.68 per cent down to finish at 17,707.

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