Technical Pick - 26/12/2023

Welcome to weekly Technical Analysis Picks, where we will dive into the world of financial markets to identify promising trading opportunities that are expected to perform well over next few days. Through the lens of technical analysis, we'll analyze charts, patterns, and key indicators to provide you with valuable insights into potential market winners.

Disc. - Not an Investment Advice, to trade with discretion.

Stock - Chambal Fertilisers & Chemicals

Sector - Fertilisers

Market Cap - 15,200 Cr

CMP - 364

P/E - 13.04 D/E - 0.30; MCap/Sales - 0.67; P/B - 2

Products / Services - Fertilisers (Distribution)

Urea - 58.8%

Phosphatic and Potassic - 36.6%

Crop Protection Chemicals - 4.6%

Latest Quarterly Result -

​Sr No (in CRs)	YoY Growth %	Sep 2023	Jun 2023
Revenue	-37	5386	5589
PAT	39	381	339
EPS	38.8	9.15	8.14

If India’s GDP increases, it need to be backed by agriculture as we are still an agrarian economy and productivity is one of the lowest in agriculture industry in India. One needs to remember that fertilizers is a highly cyclical business, hence trade shouldn't be taken emotionally, and cut positions if stop loss hits.

Technical Analysis -

Technical Analysis - This chart can play in 2 possible ways. First, we can have a breakout, which then will be considered as Double Bottom. To confirm Double Bottom breakout, we need two bullish candles backed by volume. If not, we can see a possible triple bottom of same height as previous bottom, in which we can see price retracing back to 257.

Hence, entry is important, and shouldn't be taken in haste.

Target Price - 470 (Calculated through the depth of the bottom)

Risks / Stop Loss - 340

Reward/Risk - 4.69