Indian Oil Corporation Limited : Rebound in the short term
By Oscar Salza
Entry price | Target | Stop-loss | Potential |
---|---|---|---|
₹251.95 | ₹0 | ₹246 | -100% |
The greatest majority shareholding in the Company is held by Indian Government.
According to Surperformance rating, the company is an opportunity for a trading strategy. Indeed, it is a good compromise between its value and its visibility. From a fundamental viewpoint, the security is cheap with a PER of 7.84x for 2013 and 7.5x for 2014. Besides, EV/Sales is low with a ratio at 0.24x for this year.
Technically, in daily data, even if 20 days moving average is still in a downtrend, a positive reaction in the INR 250.4 area should stop this trend and allow a technical rebound towards INR 260.65. Moreover, technical indicators show a significant oversold condition which strengthens this bullish scenario.
Considering technical and fundamental elements, it seems to be an appropriate timing to take immediately a long position in Indian Oil Corporation Limited in order to benefit from the INR 250.4 support area. A first target will be INR 270. A stop loss order will be placed under the mid-term support currently tested.