Vodafone Idea shares jumped 8% today; here's what technical analysts say

Shares of Vodafone Idea Ltd (VIL) on Monday moved up 7.56 per cent to settle at Rs 8.25. Despite the mentioned uptick, the stock has tumbled 20.37 per cent in a month and 51.44 per cent on a year-to-date (YTD) basis.

The scrip saw high trading volume on BSE today as around 6.94 crore shares changed hands. The figure was higher than the two-week average volume of 4.03 crore shares. Turnover on the counter came at Rs 56.54 crore, commanding a market capitalisation (m-cap) of Rs 57,502.35 crore.

Earlier this month, the company informed exchanges that it has made detailed representations to the Department of Telecommunications (DoT) and continues to be engaged with the telecom regulator for removal of the bank guarantee requirements for spectrum acquired before 2022. "As and when a final decision is taken by the DoT, VIL will make the necessary disclosures," it added.

A few technical analysts advised investors to maintain 'caution' on VIL shares. "We advise against bottom-fishing the stock against its current trend," one of them stated. With that being said, support on the counter could be seen at Rs 7.5 and resistance may be found in the Rs 9.1-10.4 range.

Osho Krishan, Senior Research Analyst - Technical & Derivatives at Angel One, said, "VIL has been into a correction phase. The counter has been in oversold terrain for a couple of trading weeks with no sign of respite. A series of resilience could be seen in the Rs 9.50-10.40 zone and a decisive surpassing could only trigger some traction in the counter. On the lower end, the Rs 7.50 subzone is likely to act as support, while any breakdown would disrupt the structure and could lead to further correction in the comparable period. Hence, caution is warranted in the counter."

Kushal Gandhi, Technical Analyst at StoxBox, said, "The share price of Vodafone Idea has declined by 60 per cent from its record highs over the past 82 trading sessions. This correction rally followed the formation of a double-top price pattern, which signals a potential trend reversal. Increased selling pressure was noted after a significant breakdown from this double-top pattern on September 19, with no signs of recovery in the price action. The stock displays extremely low readings for earnings per share (EPS) and price strength ranking, while the relative strength index (RSI) is currently in the oversold territory, suggesting the possibility of a mild pullback. However, we advise against bottom-fishing the stock against its current trend." The Supreme Court dismissed petitions filed by telecom companies, including VIL, to re-compute adjusted gross revenue (AGR) dues in September.

Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi, said, "Support will be Rs 7.5 and resistance Rs 9.10. A decisive move above Rs 9.10 level may trigger a further upside towards Rs 11. The expected trading range will be between Rs 7 and Rs 11 for the short term."

Sebi-registered research analyst AR Ramachandran said, "Vodafone Idea stock price is slightly bullish on daily charts with strong support at Rs 7.5. A daily close above resistance of Rs 8.4 could lead to 10 in the near term."

As of September 2024, promoters held a 37.32 per cent stake in the telco and the government's shareholding was at 23.15 per cent.