Tata Power shares hit record highs in five out of six sessions; what's next for the Tata Group stock?

Shares of Tata Power Co Ltd scaled fresh record highs in five sessions in December. The large cap stock hit all-time high in five out of last six sessions rising from a high of Rs 298.60 on December 6 to a fresh record of Rs 340.45 on December 13 (current session). Before scaling record highs this month, the Tata Power stock had hit an all-time high of Rs 298 on April 7, 2022.  It took the Tata Group stock 20 months to breach the record high touched in April 2022 as it hit Rs 298.60 on December 6 this year. 

Once regarded a defensive bet from the Tata Group, tatapower-share-price-362817">Tata Power shares have delivered 45.23% returns since October 26, 2023 or 1.5 months. In comparison, the stock has zoomed 51.91% in six months.  

The stock hit an all-time high of Rs 340.45 in the current session. The market cap of Tata Power rose to Rs 1.07 lakh crore.  

Also read: Tata Power shares rose 44% in 1.5 months; here are the price targets post sudden upsurge

The rally in the Tata Group stock has pushed it in the overbought zone. In terms of technicals, the relative strength index (RSI) of the stock stands at 82.2, signaling the stock has more buyers than sellers in the current session. Tata Power shares are trading higher than the 5 day, 20 day, 30 day, 50 day, 100 day, 200 day moving averages.     

On December 11, the share almost touched the record high of Rs 335.80 hit on December 8, 2023. It rose to an intraday high of Rs 335.25. The stock made fresh record highs for four sessions in December. Tata Power stock hit an all-time high of Rs 298.60, rising 6% on December 6. The Tata Group stock surpassed the previous record high of Rs 298 hit on April 7, 2022. 7  

In the next session, the stock crossed the Rs 300 mark to make a fresh high of Rs 332 , rising 9.58% on BSE.  

On December 8, the stock reached a record high of Rs 335.80.  

Abhijeet from Tips2trades said, "Tata Power is very overbought & slightly bullish on the Daily charts with next resistance at 354. Investors should book profits at current levels as a Daily close below support of 306 could lead to target of 276 in the near term."  

Shiju Koothupalakkal - Technical Research Analyst, Prabhudas Lilladher said, "The stock has witnessed a decent rally in the last 2 months gaining from Rs 230 zone to scale the high level of Rs 335 zone where it is showing some resistance with the indicators racing to their highly overbought zone and with slight consolidation seen one can expect for some cooling off in the coming days. Further ahead, the stock can carry on with the momentum once a decisive breach above Rs 335 level is confirmed and expect for next targets of Rs 358 and Rs 380 levels. The near-term support is near Rs 318 levels and one can expect for further upward movement with bias maintained strong. Only a decisive breach below Rs 305 zone shall weaken the bias to some extent."  

Mandar Bhojane, Equity Research Analyst at Choice Broking said, “Tata Power is presently trading at an all-time high level  having formed a rounding bottom pattern breakout with significant volume. This pattern suggests a robust bullish momentum in the stock.    

Moreover, the stock is positioned above key Exponential Moving Averages (EMAs), including the 20-day, 50-day, 100-day, and 200-day EMAs. This alignment above crucial EMAs strengthens the bullish outlook, indicating the potential for sustained upward price movement. Additionally, the Stochastic Relative Strength Index (Stoch RSI) has exhibited a positive crossover from the oversold region, further contributing to the bullish sentiment. The convergence of these technical indicators suggests that the stock may have the potential to reach a target price of Rs 420 in the near term. To manage risk effectively, it is recommended to implement a stop-loss (SL) at Rs 260.”     

 Aditya Gaggar, Director of Progressive Shares said," Consolidation of over 1 year comes to an end with a Cup and Handle Formation Breakout which was confirmed with an uptick in the volume. Looking at the indicators, MACD has given a positive crossover which suggests an extension of the existing uptrend while a reading of 32.81 in ADX shows the presence of a strong uptrend."       

Disclaimer: Business Today provides stock market news for informational purposes only and that should not be construed as an investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.  

 

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