Grasim Industries Ltd (NSE: GRASIM) is an Indian manufacturing company based in Mumbai, Maharashtra. Grasim Industries was ranked 154th in a list of the world’s best-regarded firms compiled by Forbes. It was started in 1947 as a textile manufacturer. Since then Grasim has diversified into Viscose Staple Fiber (VSF), cement, sponge iron, chemicals, and diversified financial services (NBFC, asset management, and life insurance). The company is a subsidiary of Aditya Birla Group. Grasim is the world’s largest producer of viscose rayon fiber with about 24 per cent market share. Textile and related products contribute to 15 per cent of the group turnover. Grasim Industries operates Private Harihar Airport In Harihar, Karnataka. The airport serves as an airstrip for private charter service.
On the technical front, GRASIM has higher highs and higher lows on the daily charts and is currently placed above the significant long-term EMAs. In the recent past, after clocking the high of 750 level, the stock has witnessed correction towards 675 level. The stock had previously formed a base of around Rs634-640 levels on the daily charts. At the current juncture, the stock has a support zone around Rs650-660 level on the lower side and is all set to move higher. The overall chart structure of the counter looks bullish with a technical breakout at the Rs653 level forming higher highs and higher lows. This may trigger a fresh round of buying which may take the stock towards Rs780 plus levels. The stock is currently performing in line with the broader markets indicating the inherent strength in the counter and is trading well above the long-term support levels. On the Bollinger band (20,2), the stock price is plotting above the upper band indicating the price likely to trend higher. Analyzing the recent volume price action, the volumes have been encouraging in the recent up move indicating strong hands have started accumulating the stock at current levels. On the oscillator’s side, RSI (14) is trading in the bullish zone of above 50 levels indicating the intact bullishness in the stock. We expect the counter to continue its bullish performance in the future as well and may move towards Rs800 level in the medium term. Any correction towards the recent support levels of Rs650-660 levels may be utilized to average the positions.
Srinivas Krishnan Bobba, Deputy Manager (technical research analysis) Karvy Stockbroking Ltd