Gladiator Stocks - SMS Pharmaceuticals - ICICI Securities

Strategy

Buy SMS Pharmaceuticals in the range of Rs. 73.00-77.00 for target price of Rs. 88.00 with a stop loss of Rs. 68.00. Time Frame: Six months

Technical View

The stock resolve out of its long term falling trend line and currently forming a higher peak and trough, indicating conclusion of corrective phase. In the process, it witnessed faster pace of retracement as it retraced past 15 months correction (Rs. 82 - 24) in just four months, indicating structural turnaround which makes us confident to believe the stock would outperform in the pharma space, thus offering a fresh entry opportunity

Structurally, stock has witnessed strongest pullback since all-time high of Rs. 137 (recorded during December 2015). In the current up move, stock has risen 3x (off March low of Rs. 24) which is stronger compared to previous major up move seen during Aug-Sept 2017 of 86% (Rs. 65 - 121). The intermediate shallow price corrections followed by elongated up trend, underpinned by robust volume signifies rejuvenation of upward momentum auguring well for next leg of up move

In a nutshell, we expect stock to endure its relative outperformance and head towards Rs. 88 levels as it is 61.8% retracement of 2017-20 decline (Rs. 121 - 24), placed Rs. 84 coincided with September 2018 high of Rs. 91

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_GladiatorStocks_SMSPharma_Jul20.pdf

Shares of SMS PHARMACEUTICALS LTD. was last trading in BSE at Rs.75.9 as compared to the previous close of Rs. 71.55. The total number of shares traded during the day was 168547 in over 1724 trades.

The stock hit an intraday high of Rs. 79.2 and intraday low of 72. The net turnover during the day was Rs. 12895736.

Source : Equity Bulls

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