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Tatva Chintan Pharma Chem shares tank 5% after Q3 results; what's next: Rs 1,950 or Rs 2,200?

Tatva Chintan Pharma Chem shares tank 5% after Q3 results; what's next: Rs 1,950 or Rs 2,200?

Tatva Chintan Pharma's net profit declined 49.06 per cent to Rs 11.62 crore in Q3 FY23 as against Rs 22.81 crore during the same period a year ago.

Tatva Chintan Pharma Chem shares tank 5% after Q3 results; what's next: Rs 1,950 or Rs 2,200? Tatva Chintan Pharma Chem shares tank 5% after Q3 results; what's next: Rs 1,950 or Rs 2,200?

Shares of Tatva Chintan Pharma Chem fell sharply in Wednesday's trade after announcing the December quarter (Q3 FY23) results. The stock slipped 5.44 per cent to hit a day low of Rs 2,066 over its previous close of Rs 2,184.90. Tatva Chintan Pharma's net profit declined 49.06 per cent to Rs 11.62 crore in Q3 FY23 as against Rs 22.81 crore during the same period a year ago. The company's sales rose 15.23 per cent to Rs 120.61 crore in the quarter that ended December 2022 as against Rs 104.67 crore during Q3 FY22.

"A drop in profit as compared in Q3 FY23 results in YoY terms has led to a dip in Tatva Chintan stock price today," said AR Ramachandran from Tips2trades.

Support on the counter could be seen at Rs 1,950, followed by Rs 2,050 and Rs 2,064 levels, analysts said.

Around 1,004 shares changed hands today on BSE, which was four times higher compared to Tatva Chintan Pharma's two-week average volume of 250 shares. Turnover on the counter stood at Rs 20.97 lakh, commanding a market capitalisation (m-cap) of Rs 4,615.76 crore.

Technical view

Sneha Seth, Derivatives Research Analyst at Angel One, said, "The stock has been forming lower top - lower bottom on the daily chart. This counter has a cluster of support around the Rs 1,950-2,050-odd zone, and until it respects these zones, traders can stay long. On the higher side, the 20-DEMA has been acting as a resistance zone which is placed around Rs 2,150-2,200 levels. In case of any upward move beyond the mentioned resistance, the stock should attract fresh buying interest."

Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, "The counter is trading near its historical support of Rs 2,050 along with a bullish inverted hammer seen on a daily scale. If the counter sustains above Rs 2,100 for the next couple of sessions, then one can buy it for a target of Rs 2,300, keeping a stop loss placed at Rs 1,999. Fresh buying at current levels is not advised."

Tips2trades' Ramachandran said, "Rs 2,064 is strong support on the daily charts, below which a fall till Rs 1,960 looks possible. Resistance will be at Rs 2,193."

The stock was last seen trading lower than 5-day, 20-, 50-, 100- and 200-day moving averages.

The counter's 14-day relative strength index (RSI) came at 39.76. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a negative price-to-equity (P/E) ratio of 87.94.

Tatva Chintan Pharma has an average target price of Rs 2,650, Trendlyne data showed, suggesting a potential upside of 27.23 per cent. The stock has a one-year beta of 0.72, indicating low volatility.

The company is an integrated specialty chemical company, present across the value chain manufacturing Phase Transfer Catalyst, Structure Directing Agents, Electrolyte Salts and Pharma & Agrochemical Intermediates and Specialty Chemicals.

Tatva Chintan has two manufacturing facilities at Ankleshwar and Dahej SEZ, Gujarat. The company has a customer base spanning over 25 Countries including USA, UK, China, Germany, Japan and South Africa. Exports constitute 79 per cent of the total revenue during FY22.

Meanwhile, Indian equity benchmarks fell sharply today, dragged by banks, financials and energy stocks.

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Published on: Jan 25, 2023, 2:57 PM IST
Posted by: Tarab Zaidi, Jan 25, 2023, 2:49 PM IST