Potential Cup & Handle pattern.A very strong base formed at 151.15. We can expect a good reversal from here. Few resistances are on the way, but the risk-to-reward ratio looks very good.
ELECTCAST trade ideas
Electcast at a support level and offers good RR.Electrosteel Casting. Reversing from support.
- Offers good RR.
-Can be a good swing pick.
Risk- 16%
Reward-40%
RR: 1:2.5
Tweak the SL and Tragets as per your trading style and risk appetite. This is just a view and is not a trading advice.
ELETCAST - Broadening Wedge PatternPrice consolidate since Janaury 2024 and it form broadening wedge pattern. Price currently in support line but it is looking in only Day Timeframe. Please do not consider or enter without good candle formation in Day time frame and it should have tight stoploss below the support line.
Bearish DivergenceWhat is Bearish Divergence?
Regular bearish divergence occurs when the price of an asset reaches a higher high, but a technical indicator, such as an oscillator, forms a lower high. This suggests that the upward momentum is weakening, and a potential trend reversal to the downside might be on the horizon
25-year breakout with retest171 is the ideal entry price if entered after the retest. This is such a massive breakout. 25 years!!! The crazy thing is it also did a retest. This stock will soon trade above 600. It being in ASM has halted the fast movement. This can create generational wealth in the next 10 to 15 years. Hold this for your next generation. You don't see such breakouts often. Very, very rare.
Big breakoutExcellent breakout with good volume. 353 is the next target. Hold for the next 10 years; it will create generational wealth.
#ELECTCAST VCP in DTF with VolumeStock is in UT in the DTF
Formed a VCP in the DTF
Volume dry up for 2days before BO
MACD Crossover
EMA rule in place.
MindSet: Entered with 50%qty.
Electcast LONG It is making VCP pattern and after breaking out at 208, it has already consolidated and now looking for good upside move.
Electrosteel: The Dark Horse in the Ductile Iron Pipe Industry!Summary
● Electrosteel Castings Limited (ECL) is a prominent Indian company specializing in ductile iron (DI) pipes, fittings, and cast iron (CI) pipes. With a market cap of ₹13,640 Cr, ECL generates 88% of its revenue from India, holding a 28% domestic market share.
● Over the last 3 years, ECL recorded a 29% sales CAGR and 97% profit growth. Its current PE ratio of 15.3 is below the industry average, suggesting undervaluation.
● ECL plans to boost DI pipe capacity to 1 million tons by FY26. The ductile iron pipes industry is poised for growth due to urbanization and government initiatives.
● With its strong market position and robust financials, ECL is well-positioned to capitalize on this opportunity and deliver shareholder value.
Investment Advice by Goodluck Capital
Buy Electrosteel Casting NSE:ELECTCAST
● Best Buy Range - 210 - 220
● Target - 275 - 280
● Potential Return - 28 - 30%
● Approx holding period 8 - 12 months
Company Overview
Electrosteel Castings Limited produces and supplies ductile iron (DI) pipes, fittings, and accessories, as well as cast iron (CI) pipes, both in India and globally. Their DI pipes and fittings are used in various applications such as water transmission, potable water distribution, industrial water supply, ash-slurry systems, fire-fighting systems, desalination, sewerage, stormwater drainage, and recycling. They also offer ductile iron flange pipes for temporary installations and restrained joint pipes. Additionally, the company supplies metallurgical coke, sinter, sponge iron, ferro silicon, pig iron, and silico manganese ferro alloy, along with cement branded as SPL GOLD. Originally named Dalmia Iron and Steel Ltd, the company was established in 1955 and is headquartered in Kolkata, India.
Market Capitalization - ₹ 13,640 Cr.
Peer Companies
● Jindal Saw NSE:JINDALSAW - ₹ 22,576 Cr.
● Jai Balaji Industries NSE:JAIBALAJI - ₹ 19,682 Cr.
● Welspun Corp. NSE:WELCORP - ₹ 18,092 Cr.
Technical Aspects
● In January 2008, the stock reached an impressive peak of ₹71 but subsequently faced a significant decline.
● The price eventually stabilized around ₹8, leading to an extended period of consolidation.
● During this time, a Rectangle pattern, often referred to as the Darvas Box pattern, took shape.
● After breaking out of this pattern in May 2023, the stock price surged past its previous strong resistance level in October 2023.
● Since then, the stock has maintained its upward momentum and is currently trading just shy of its historical high of ₹226.
● Expectations are high that this momentum will sustain and lead the stock to reach new peaks in the near future.
Relative Strength
● The chart clearly illustrates that Electrosteel Castings has greatly outperformed the Nifty Smallcap 250 index, boasting an impressive annual return of 219%, which is truly an outstanding achievement.
Revenue Break-up
● Product wise break-up
➖ The primary source of the company's revenue comes from the production of Ductile Iron pipes and fittings, which alone makes up about 86% of its total income. Additionally, the company manufactures Cast Iron pipes, contributing roughly 2.8% to the overall revenue.
● Location wise break-up
➖ The company generates nearly 88% of its revenue from India, where it holds a 28% share of the domestic market. The remaining 12% of its income is sourced from international markets.
Revenue & Profit Analysis
● Over the last three years, this stock has recorded an impressive compounded annual growth rate (CAGR) of 29% in sales. Additionally, the total profit growth during this period has been remarkable, achieving a staggering 97% CAGR.
● Furthermore, the company has successfully maintained an operating profit margin of 16%, a notable increase from 10% in FY24.
● For the fiscal year 2024, earnings per share (EPS) have surged from 5.31 in fiscal year 2023 to an impressive 11.97. Currently, the EPS for the past twelve months is at 14.69.
● A closer look at the quarterly results shows that the company reached a record high in quarterly sales, reporting 2,012 crore in June, up from 2,004 crore in the March quarter. This figure significantly exceeds last year's June quarter sales of 1,685 crore.
Product Demand Analysis
● Inventory Turnover Ratio
➖ Current Inventory Turnover - 1.82
➖ Inventory Turnover 3 years ago - 1.70
➖ These figures indicate that product demand has risen over the past three years.
Valuation
● P/E Ratio
➖ The company's current price-to-earnings (PE) ratio is 15.3, which is below its one-year median PE of 15.8. Compared to the industry average PE of 36.76, this suggests that the stock is significantly undervalued at present.
● P/B Ratio
➖ The stock seems to be undervalued, with a price-to-book (PB) ratio of 2.67, particularly when compared with the industry average PB ratio of 5.52.
● Intrinsic Value
➖ Electrosteel Castings is presently priced at ₹220, which is significantly below its intrinsic value of ₹258, suggesting that the stock is currently undervalued.
● Peg Ratio
➖ A PEG ratio of 0.47 suggests that the stock is undervalued relative to its expected earnings growth.
Cash Flow Analysis
● The operating cash flow has experienced an impressive leap, climbing to 806 crore from 452 crore in FY23. This remarkable growth highlights the company's robust financial health. Furthermore, the current CFO/PAT ratio stands at 0.9 of its five-year average, reflecting the company's exceptional capability in turning profits into cash efficiently.
Debt Analysis
➖ The company's existing debt stands at Rs. 2,332 crore, a figure that is notably low when juxtaposed with its market capitalization of Rs. 13,655 crore.
➖ With a debt-to-equity ratio of merely 0.46, it is clear that the debt burden is manageable for a capital-intensive enterprise, allowing the company ample room to pursue further financing if required.
➖ Examining the balance sheet shows a remarkable decrease in debt, which has fallen from Rs. 2,667 crore last year to the present Rs. 2,332 crore.
Capex Plans
➖ The ongoing capital expenditure stands at around ₹700 crores and is on track, with ₹410 crores already utilized by the end of Q1 FY25.
➖ There are ambitious plans to boost the total manufacturing capacity of DI pipes to 1 million tons by FY26.
➖ Additionally, land is being acquired in Odisha for a new Greenfield project focused on DI pipes and fittings.
Shareholding Pattern
➖ The promoters currently hold about 46.22% of the company, up from 44.08% in December 2023, indicating growth during the March quarter.
➖ Foreign Institutional Investors (FIIs) have been consistently increasing their stakes, with total holdings reaching 21.16% as of June 2024, a significant rise from 14.93% in June 2023. On a quarter-to-quarter basis,
➖ Domestic Institutional Investors (DIIs) have raised their holdings to 0.44% from 0.36% in the March quarter; however, this represents a notable decline from the 1.68% recorded in the same period last year.
Ductile Iron Pipes Industry Outlook
● Advantages of choosing DI pipes over PVC pipes
➖ According to the analysis of the ductile iron pipes market in India, these pipes are made up of approximately 90% recycled materials and are fully recyclable.
➖ Additionally, using ductile iron pipes instead of PVC can lead to an energy consumption reduction of around 40%.
● Ductile Iron Pipes Market Growth
➖ Ductile iron pipes play a crucial role in public infrastructure, serving irrigation, drinking water distribution, sewage, and wastewater systems.
➖ With India's economic growth, the rise of smart cities and projects like Bharatmala Priyojana and the Narmada Valley Development Project is driving the demand for extensive pipeline networks, boosting the ductile iron pipes market.
➖ Factors such as increasing urbanization and government initiatives like Jal Jeevan Mission, AMRUT, and Smart City Mission, focused on delivering drinking water to households, are further fueling this demand.
Conclusion
● After thoroughly examining both the technical and fundamental factors, we have concluded that Electrosteel Castings is well-positioned for substantial growth, driven by the increasing market demand for ductile iron pipes, which is likely to positively impact its share price as well.
Electrocast - Ascending TriangleElectrocast :
Ascending Triangle breakout possibility
Looks good above 227.5 with support at 223
Ready to fly.It appears to be poised for a breakout, with significant trading volumes observed. The delivery volume has been exceptionally impressive, indicating the potential for a substantial upward movement in the near future. My target range is approximately 280 to 300, with a possibility of reaching 353.
ElectroSteel Casting - Double Bottom & Rectangle BreakoutElectroSteel Casting has given a double bottom and Rectangular breakout and re-tested as well. We can see price moving towards 285-300. Other factors:
1. Best TTM profits
2. FIIs & Promoters increasing stake
3. RSI will improve
4. There is a pennant / triangular breakout as well
Right Stock at Right Time at Right Price by Cleaneasycharts!!
Cheers!!!
Monthly breakout retest.The stock has successfully completed the retest on the weekly chart. Now, we wait for the monthly candle to form. Very low volumes so far. It looks good, and I am positive for a good upmove in the next 2-3 months. My medium-term target is 353.
6 months breakout!The stock gave a breakout on the weekly chart a week ago. Last week, the retest was done successfully, and today there was a fantastic recovery. Expecting a serious re-rating from here. An extremely cheap stock. Don't forget that Blackrock entered at 196. The weekly chart looks beautiful.
ELECTCAST pattern looks like a "Cup and Handle" formation.1. **Cup and Handle Pattern**:
- The pattern looks like a "Cup and Handle" formation. The cup is the rounded bottom, and the handle is the slight consolidation or pullback after the cup's high point. This is generally a bullish continuation pattern.
- The breakout from the handle typically signals a bullish move.
2. **Trend Channel**:
- The price is moving within an upward sloping channel, with the upper and lower bounds of the channel being parallel.
- The current price is near the upper resistance of this channel, indicating that if the price breaks out, it might see a strong upward movement.
3. **Price Target**:
- Based on the height of the cup, the projected price target after a breakout appears to be around ₹275, which is a 31% increase from the current level of ₹210.
- This target is drawn vertically from the breakout point of the handle to the top of the potential move.
4. **Volume**:
- There seems to be a slight increase in volume as the price moved up, supporting the bullish sentiment. However, the recent drop in volume could indicate a consolidation phase before the next big move.
- The highest volume bar appears to correspond to a significant upward move, which is a positive sign.
5. **RSI**:
- The RSI (Relative Strength Index) is around 57.75, which is in the neutral zone but slightly leaning towards the bullish side.
- It’s not overbought or oversold, indicating that there might still be room for the price to move up.
### Conclusion:
The chart suggests a potential bullish breakout from the cup and handle pattern, with a price target of around ₹275. However, the price is currently at the upper boundary of the trend channel, so it's crucial to watch for a confirmed breakout with increased volume. If the breakout occurs, the price could move towards the target, but if the resistance holds, there might be a pullback.
Electcast : Breakout PossibilityElectcast ::
Looks great for a resistance breakout
Cup & Handle possibility too
Need to sustain215 levels
ELECTRO STEEL CASTElectro Steel Cast is going for a bearish move....!
When candle breaks 141 down fall will starts.
Major points are marked in the chart.
*Investments in security markets are subjected to market risk do own analysis before investing.
ELECTCAST bullish; above 207.2 ? - Monday 22-July.The above information does not constitute investment/trading recommendation and it is purely for educational purpose....
INTRADAY Trading Strategy in 3 stages of breakouts:
1) Impulse upmove stage: The strong upmove (nearly upto 1.5% from trigger-price) happens within five minutes. "High Risk Traders" buy on breakouts in hope of continuation of upmove. "High Risk Traders" may have to patiently wait through the Pullback-Consolidation stage to realize profits. High risk:High reward set up as breakouts may fakeout (reversal)also
2) Pullback-Consolidation stage: After the above "Impulse upmove stage"; the price may then pull back and move sideways (between "Open" price and "High" of the above "Impulse upmove stage"). "Safe traders" with minimum risk profile wait for a breakout from the consolidation stage to enter into trade , to book high profits in the final "Breakout continuation" stage
3) Breakout continuation: Stocks often in the third stage breaks up above the "High" of the first "Impulse upmove stage" and continue to go higher again.(another 2-3%)
Both Safe Traders/High Risk Traders book profits at this stage
SWING Trading Strategy:
Position is kept open, only upon stock closing above the entry price on day closing basis and is held on for 5-10 trading sessions for larger gains (5-10%)
The above information do not constitute, financial, investment, trading, or other types of advice or recommendation. It is purely for educational purpose....
Technical beauty!Speechless. I can keep looking at this beauty and never get tired of it. Long-term target: 353.
Electrosteel Castings another water theme related stockElectrosteel Castings (Electcast)
-from Strong Sector
-Clean setup
-Vol kickin in, clearly Grenn vol > Red vol
-Signal candle
-Good shakeout
103% possible upside?It appears the stock has formed a triple bottom on the weekly chart. The stock has been consolidating for several months now. If the stock breaks above that resistance level, there could be a significant rally.
ELECTROSTEEL CAST - W formation! Overview & Observation:
1. Beautiful Double bottom formation.
2. Prices are showing weakness currently.
3. Might see some strength build up later once it starts moving ATH (200 levels)
Trade Plan:
1. Just keeping it on my radar and will observe its price behaviour in coming weeks...
- Stay tuned for further insights, updates and trade safely!
- If you liked the analysis, don't forget to leave a comment and boost the post. Happy trading!
Disclaimer: This is NOT a buy/sell recommendation. This post is meant for learning purposes only. Please, do your due diligence before investing.
Thanks & Regards,
Anubrata Ray
