Polycab – A Case Study

Polycab, ITRaid, Event Decline
  • They say don’t catch a falling knife. True unless you are skilled to do so over a longer period of time. Remember how everyone became an analyst in Feb 2023(Adani – Hindenburg Saga)? What happened? Well, Fundamentals are surely out of the window, but this is a no-brainer. So, let’s begin.

    Polycab, ITRaid, Event Decline
    Polycab, ITRaid, Event Decline

    A hedge fund guy, GQG – Rajiv Jain, comes in to buy group stocks worth 15000 Crores. Let’s put it in a fancy way – worth 150 billion! And he is not in Hawaii(Goa Pakad lo) on a cool beach or posting MTM!

    Every other person was an analyst and recommending to stay away. That’s what the problem is. There is a difference between a long, bearish trend and an event-based decline. An event-based decline in an “uptrending stock” usually marks a bottom. It has some characteristics, like volume, Fib, and price, but the point is that the same is witnessed in Polycab.

    So what happens? Well, It should rebound to 6500+ levels in the next couple of months/ a Year, giving an upside of over 50%.

    We believe the stock has made a short to mid-term bottom. The stock has solid support at 0.5%, which is at 3800. The risk? It’s somewhat 5% (4.5%) from current levels.

    The analysis uses Volume, Price, Short Interest, and, in simple language, a Contrarian approach. Take this as a case study.
    Similar charts can be seen on Netflix, Adani, and so on.

    Lovelesh Sharma
    CMT, CFTe
    MarketFeds Analytics

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