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Robust sales drive ITI Ltd shares to ₹289.30 despite financial challenges
The stocks of ITI Ltd gained 8.25% to reach ₹289.30 from the previous close of ₹283.50 during the trade session. The stock started trading at ₹286.00, and intra-day touched a high of ₹309.55 as lows of ₹285.05 were marked for the day. This upsurge is driven by aggressive market sentiment on a day when the trading volume stood at over 11.5 million shares with a total traded value of ₹ 353 crore.
The 52-week range demonstrates its higher volatility where it reached up to ₹384.30 and the lowest was ₹210.00.
There are forecasts that the corrective rally will keep ITI above both its 20-day moving average of ₹278.10 and 50-day moving average of ₹270.69 opening the way for higher prices.
Resistance and Support Levels
Key resistance levels for ITI Ltd are noted at:
R1: ₹294.02
R2: ₹298.73
R3: ₹302.67
Support levels for the stock stand at:
S1: ₹285.37
S2: ₹281.43
S3: ₹276.72
Crucial to continue the uptrend is the ability to trade above ₹282.75.
Stability Despite Economic Fluctuations
Based on fundamentals, ITI Ltd. revealed a sharp year-on-year growth in its net sales, ₹1,016.20 crore for September 2024, representing a growth of 312.31%. However, the company is still under pressure because it has posted four loss-making quarters in a row; its P/E ratio equals -55.4, and the EPS is equal to zero.
The operation costs, interest costing 19.1% of total revenues and employee costing 18.34% of total revenues, pose a great threat to profitability, necessitating some overhaul. The company’s market capitalization is ₹27,799 crore, and the dividend yield is 0%.
Intraday and Future Outlook
On an intraday basis, the analysts expect the price to increase to ₹293.33, with targets as high as ₹295.28. Tomorrow’s expected highest target levels are at ₹279.88, ₹283.67, and ₹291.37 based on the analysis of the charts.
A Neutral Conclusion for Investors
However, ITI’s latest contracts and sales growth indicate some optimism, even for a firm that has been facing numerous threats to its financial health. While showing some growth advantage when compared with peers in the telecommunications equipment industry, ITI appears to provide less profit potential. Investors are advised to monitor technical indicators and evaluate the company’s strategic direction as ITI navigates its recovery phase.