Please refer to the post made on 04th July 2017: http://www.chartadvise.com/gnfc-neem-revolution-value-investing/
Continuing with the previous analysis, stock has achieved the target zone at 510-520 levels (today’s high registered at 519.55).
The fourth quarter net profit was seen rising 226% from 73 crore to 238 crores. Company has recently announced launching of Neem Hand-wash, Face-wash, Shampoo and Hair Oil products which is researched after their primary business of Neem coated fertilisers (note: this was already predicted and mentioned in the post made). Company also has reduced its debt to 0.19% from 0.38% and is expected to be debt free within this fiscal year.
The product launch is still to hit the market while the pre impact has already seen backed by strong quarterly numbers. The current rally has produced 84% return for investor in just 3 months.
The long term chart shows price extension towards 261.8%, thus indicating halt at this point. Meanwhile, RSI has reached towards its all time high levels around 85 levels while supports the price action. Dips should be used to buy. These kinds of counter as value investing are symmetrical in behaviour. In these cases, we generally see higher damage in momentum than damage in price. This means the profit booking sustains within small range and pullbacks are very minimal. Looking at GNFC, 23.6% retracement of the current rally resides at 410-420 levels, which can be used as support levels and used to buy in. Thus, one should continue to keep this counter in radar and find opportunity for long as investment.