Tata Communications shares jumped 6% to hit record highs; will this telecom stock climb further?

Shares of Tata Communications Ltd rose sharply on Wednesday to scale their all-time high levels. The stock surged 5.63 per cent to hit a lifetime high value of Rs 2,137.20. It eventually settled 5.18 per cent higher at Rs 2,128.25.

The counter traded higher than the 5-day, 10-, 20-, 30-, 50-, 100-, 150-day and 200-day simple moving averages (SMAs). The counter's 14-day relative strength index (RSI) came at 68.76. 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 92.97 against a price-to-book (P/B) value of 6.13. Earnings per share (EPS) stood at 22.89 with a return on equity (RoE) of 6.60.

It saw high trading volume on BSE as around 78,000 shares changed hands today. The figure was higher than the two-week average volume of 14,000 shares. Turnover on the counter came at Rs 16.38 crore, commanding a market capitalisation (m-cap) of Rs 60,655.13 crore.

A few analysts largely remained positive on the counter. "The stock has been in a consolidation phase during the last three to four months. We are now seeing some buying interest ahead of the upcoming quarterly results as telecom companies are expected to do well. Investors with a medium- to long-term view can continue to hold on to the stock," said Kranthi Bathini, director of equity strategy at WealthMills Securities.

On technical setup, an analyst suggested that the stock looked 'strong' on daily charts. With that being said, support could be seen at Rs 2,050.

"The stock looked strong on daily charts and has potential to touch Rs 2,350 level in the near term. Keep stop loss placed at Rs 2,050 for this trade," said Ravi Singh, Senior Vice-President (Retail Research) at Religare Broking.

As per Tata Communications' website, it carries around 30 per cent of the world's internet routes and connects businesses to 80 per cent of the world's cloud giants and 4 out of 5 mobile subscribers. As of June 2024, promoters held a 58.86 per cent stake in the Tata Group firm.