Urja Global shares dive 10% after two-day spike; here's what is happening

Shares of Urja Global Ltd fell sharply in Tuesday's trade, halting their two-day winning run. The stock today cracked 10 per cent to hit a day high of Rs 11.47 over its previous close of Rs 12.74. Prior to this, the scrip had gained 43.95 per cent in the previous two sessions.

Recently, the company entered into an agreement with Tesla Power India for the purpose of manufacturing and supply of batteries under the TESLA POWER USA brand. "Urja Global will utilise the 'Tesla Service centers' for the promotion of their EV Battery Service requirements with respect to E-2 Wheeler Batteries," Urja Global said in a regulatory filing.

The sharp movement in the share price came after the agreement. Later, a Mumbai-based investor (without mentioning Urja Global) cited that TESLA POWER USA is not associated with Elon Musk's Tesla.

"I am thrilled to read a news about a listed Indian company 'tied up' with Tesla USA. I did some homework and found It's not Elon Musk's Tesla, it actually belongs to a Delhi-based promoter's USA subsidiary in the name of Tesla. Stock is in upper circuit. Long live bull market," Vijay Kedia tweeted.

On the earnings front, Urja Global reported a 57.34 per cent year-on-year (YoY) fall in net profit at Rs 0.09 crore during the March 2023 quarter. The figure stood at Rs 0.22 crore in the same quarter a year ago. On the other hand, gross sales of the company declined 74 per cent YoY to Rs 10.64 per cent during the quarter under review.

Shares of the company scaled their 52-week high of Rs 14.85 on July 25, 2022, and a one-year low of Rs 6 on March 28, 2023.

On technical setup, support on the counter could be seen at Rs 10.55.

Vaibhav Kaushik, Research Analyst at GCL Broking, said, "Urja Global has shown a strong breakout above Rs 8. Now it is overbought. So, a 'buy on dip' strategy is recommended near Rs 10 levels. Keep stop loss placed at Rs 7."

AR Ramachandran from Tips2trades said, "Urja Global stock price is bullish but also overbought. It has resistance at Rs 12.60 on the daily charts. Investors should book profits at current levels as a daily close below the support of Rs 10.55 could lead to a target of Rs 7 in the near term."

Vaishali Parekh, Vice-President - Technical Research at Prabhudas Lilladher, said, "The stock has picked up well since last 2 weeks from Rs 7.50-odd zone. The overall chart pattern is erratic with no clear candle stick formation. The previous peak zone is near Rs 14.75, where we can find resistance. The near-term support would be near Rs 9.70 (200-period daily moving average)."

Bourses BSE and NSE have put the securities of Urja Global under the short-term ASM (Additional Surveillance Measure) framework. The parameters for shortlisting securities under ASM include high-low variation, client concentration, close-to-close price variation, average daily volume in a month and price-to-earnings (P/E) ratio. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors about high volatility in share prices.

Urja Global is engaged in the business of design, consultancy, integration, supply, installation, commissioning and maintenance of off-grid and grid-connected solar power plants and decentralised solar applications and trading of solar products, lead acid batteries.

Meanwhile, Indian equity benchmarks were seen trading with sharp gains today, led by strong buying interest in consumer, metals, pharma, energy and technology stocks.

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