Dear Long term investors, in this highly volatile market, here is a value unlocking stock for our readers. Bata has been a virtually debt-free company for a decade showing growth and consistency in its revenues. We analyzed the daily, weekly, and monthly charts for you. Take a look.
Daily Chart
Bata is trading in the given channel since 19th March 2020 and it has touched its upside (resistance) level on Thursday (i.e. 30th April '20). Today's reversal move from the same indicated compliance with the channel resulting in a reversal trend. Hence, we expect the prices to move downwards to its support level in the range of 1240-1260. A downside from this range is not expected unless it breaks the given channel.
Weekly Chart
Similar to the daily chart, the weekly chart also suggests a downside according to the resistance zone, Fibonacci levels, and the trendline.
The line chart attached also gives an indication that the same price range as mentioned above can be tested.
Monthly Charts
The 2011-2019 candlestick chart indicates the strength of the trendline drawn above. A healthy breakout on the trendline (as tagged in the chart) was given and the stock rallied almost 50%. A similar movement can be seen and an opportunity to generate more returns can be grabbed once the monthly trendline resistance is sustained.
Safe investors can buy the stock after monthly trendline resistance is sustained. While other investors can enter at the levels posted above in the weekly and daily charts keeping the support of channel as the stop-loss (closing basis).
Bata has been completely debt-free since 2011. However, under the new Ind-AS standards, the company converted its rental agreements into leasehold properties resulting in an increase in its other liabilities. As a result, the "Rent", "Depreciation and amortization expense" and 'Finance cost" of the current periods are not comparable to the earlier periods.
We will come up with a detailed fundamental analysis of Bata India Ltd. Stay tuned for more updates
コメント