Chart Check: Up 40% in 3 months! This smallcap stock is on track to hit fresh record highs; here’s why

Kirloskar Brothers, part of the capital goods industry, rallied about 40% to hit a fresh 52-week high in April 2023, but the technical setup suggests that the upside may not be over yet.

The stock, part of the S&P BSE Smallcap index, rose from Rs 316 recorded on January 11, 2023, to Rs 442 on April 11, 2023, which translates into an upside of about 40%.

Tracking the momentum, the stock hit a fresh 52-week high of Rs 450 on April 12, 2023. Short- or medium-term traders can look at buying the stock now or on dips for a possible target above Rs 600 in the next 6 months, suggest experts.


Most technical indicators are in a buy mode and a breakout from a resistance line of Rs 427 on the weekly charts has given comfort to the bulls to move forward.

Most technical indicators are in a buy mode, and a breakout from a resistance line of Rs 427 on the weekly charts has given comfort to the bulls to move forward.

The Relative Strength Index (RSI) is at 68.7. RSI below 30 is considered oversold and above 70 is considered overbought, Trendlyne data showed. MACD is above its center and signal line, this is a bullish indicator.

“Kirloskar Brothers, on its weekly charts, resumed its second leg of up move, post a breakout from resistance levels of 427 with MACD in buy mode above the signal line, qualifying it for a buy,” Sujit Deodhar, Head - Technical Analyst, Wellworth Share & Stock Broking, said.

“A strong first leg from Rs 76-499 (27 March 2020-23 July 2021) has been observed in this stock on weekly charts, followed by a correction closer to 61.80% of its up move at 248 levels,” he said.

The long-term bullish trend remained intact through the corrective phase ,and post a consolidation, this stock has resumed its up move.

“It can be observed that the stock witnessed a low volume phase during correction and a high volume spike on price rise indicating bulls charging on the higher side,” highlights Deodhar.

Technical indicator MACD is in buy mode above the zero line on weekly charts, supporting the positive stance.

“One can initiate longs in this stock at current levels of 440 and on any dips towards Rs 400-375 zone, with targets placed @ 672 levels in the next 12-24 weeks. A protective stop loss of 350 levels should be in place for the trade,” recommends Deodhar.

(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of Economic Times)