Shares of Gujarat Narmada Valley Fertilizers & Chemicals Ltd (GNFC) added another 2.77% today and are trading at ₹ 728.50 per share. The share price has increased by 30.53% in the last month.
On Friday, March 12, 2022, the company’s share prices were up 12.5 odd% and they gained 19% in the past week, but they’re not stopping there. In the month of March, the stock gained 28% and since the beginning of this year, it gained 61%.
Its share prices usually move in tandem with the TDI prices (Toluene diisocyanate). TDI prices have surged due to supply disruptions on account of the Russia Ukraine Crisis. On Friday, there was a fair amount of long buildup in the March Futures. The open interest was higher by almost 14% and it saw nearly 15 lakh shares marked for delivery as compared to the 3 month average of just ₹ 5 lakhs.
On February 24, 2022, the shares of the company closed at a low of ₹ 508. In three weeks, since then, the share price has surged by 43.41%.
Amol Athawale, Deputy Vice President – Technical Research, Kotak Securities Ltd, gave a hold recommendation on the counter. He said that on the daily and intraday charts, the stock is holding higher high and higher low series formation which is broadly positive for the company.
He said that momentum indicators, in the short time frame indicate that the stock is in an overbought zone and there are high chances of a quick short-term price correction. However, if it manages to hold above ₹ 660 then a continuation of the uptrend towards ₹ 735- ₹ 775 can be expected. On the flip side, a short-term correction up to 620-602 could possibly be triggered upon dismissal of ₹ 660.
GNFC said that except for its product mix optimization, overall production and sales improved, due to which the margins are actually enhanced. In the case of fertilizers, the government granted a special subsidy to compensate the fertilizer producers mainly of DAP/NP/NPKs came as a breather and acted as a shield towards minimising the adverse impact on financials, it added.
Further, it said that it is in a position to leverage boom in specific products and optimize both, realization and profits. It is confident of stable performance balancing its product mix to serve markets.
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