Why Adani Ports has 50% upside from CMP?

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For the uninitiated, CMP = Current Market Price. At the time of writing the price of an Adani Ports share is Rs 890.75.

Here’s a quick snapshot of the share we are talking about:

(Source: Tickertape)

This article is purely focused on trading this stock and not an investment advise. The brief overview is largely done to get familiarity to both new and old entrants in the trading space. We largely trade Options to have a multiplier effect though trading this stock in purely cash with no leverage is also fine. Before going into technical analysis, let’s have some more quick insights for this stock. The financial trend of this share has also been consistent contrary to many traders who are still in denial that this stock will not perform on the upside from here.

(Source: Tickertape)

Recent news has also highlighted that the order book for the company is nothing but growing.

(Source: Times of India)

In terms of analysts’ recommendations, the signal is also a BUY.

(Source: Trendlyne)

Now here is our chart (time frame: monthly) giving a price target of Rs1300 (which is around 50% upside from CMP)

The overall trend is BULLISH with both chart patterns, i.e. the symmetrical triangle at the lower half and the bullish flag (or rectangle as you deem fit). The long wicks (sharp lines on candles on top of it) in the 2nd pattern between the price band of Rs660 and Rs900 showcase bullish consolidation / demand as per the rules of technical analysis. If the wicks were on the downside, it’d be a bearish scenario.

Even when compared to NIFTY YTD this year, the stock has given better returns than just trading the vanilla index.

Another bullish trigger underlying the price action can be that EPS (Earnings Per Share) is projected to grow at around 30%. Since all news follows price action and all of the noise is post event analysis for the amateur audience, our hypothesis is that this strong market is currently not baked in the price. Hence the platform the rise in price per share is at least 30% from here (of course there will be volatility and nothing is all so easy in the capital markets).

Source: Trendlyne

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