Shares of South Indian Bank surged on Wednesday after declaring the December quarter (Q3 FY23) results. The stock settled 6.33 per cent higher at Rs 17.65 over its previous close of Rs 16.60 on BSE. South Indian Bank’s net profit came at Rs 102.75 crore in Q3 FY23 as against a net loss of Rs 50.31 crore during the same period a year ago (Q3 FY22). The lender’s total operating income rose 13.59 per cent to Rs 1,898.27 crore in the quarter that ended December 2022 as against Rs 1,671.13 crore during the previous quarter that ended December 2021.
Analysts largely felt that the stock is rangebound in the Rs 15-22-odd zone. One analyst said that support on the counter could be seen at Rs 15.65, while another said an uptick near its 52-week high (Rs 21.80) may happen if the scrip stays above Rs 15.50. One more analyst suggested keeping a stop loss placed at the Rs 16.45 level.
Sneha Seth, Derivatives Research Analyst at Angel One, said, “South Indian Bank has given a spectacular move from the support zone of Rs 7-8 and has almost touched Rs 22 in December. Post that it has been trading in the range of Rs 15-22 and has now approached the lower side of the range. Till it sustains above Rs 15.50, the undertone remains bullish for the immediate upside of Rs 20-22 in the near term.”
Jigar S Patel, Senior Manager – Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, “Recently, the counter gave healthy correction of 23 per cent. At present it is well placed above the 50- & 100-Daily Exponential moving average. Having said that, hidden divergence is seen on the daily RSI scale which is looking lucrative. So, one can buy South Indian Bank in the range of Rs 17.5-18 for a target of 19.5 and a stop loss would be placed at Rs 16.45.”
AR Ramachandran from Tips2trades said, “South Indian Bank has strong support at Rs 15.65 on the daily charts. A daily close above Rs 18.75 should lead to higher targets of Rs 19.75-21.”
The stock today traded higher than 50-day, 100- and 200-day moving averages but lower than 5-day and 20-day moving averages.
The counter’s 14-day relative strength index (RSI) came at 46.33. 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 4.87.
South Indian Bank has an average target price of Rs 14, Trendlyne data showed, suggesting a potential downside of 20.68 per cent. The stock has a one-year beta of 0.75, indicating low volatility.
Meanwhile, Indian equity benchmarks fell sharply today, dragged by banks, financials and energy stocks. The 30-share BSE Sensex pack slumped 774 points or 1.27 per cent to settle at 60,205, while the broader NSE Nifty index moved 226 points or 1.25 per cent down to close at 17,892.
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