Call Writ­ing at ₹ 520 Sig­nals Limited Up­side for Tata Mo­tors This Month

The Economic Times - - Smart - Mar­ket In­tel­li­gence

Mum­bai: Tata Mo­tors’ stock is likely to be muted in the rest of the February se­ries af­ter a poor show in the third quar­ter earn­ings, with ₹ 520-level ex­pected to act as a stiff hur­dle as sig­nif­i­cant call writ­ing was seen at that strike, de­riv­a­tive an­a­lysts said.

“The stock has bro­ken its weekly sup­port of ₹ 500 and is also trad­ing be­low its 200-day sim­ple mov­ing av­er­age as well as 50-day sim­ple mov­ing av­er­age. Hence, weak­ness is likely to con­tinue,” said Chan­dan Ta­paria, de­riv­a­tive an­a­lyst at Moti­lal Oswal Se­cu­ri­ties.

Cur­rently, the stock’s 200-day mov­ing av­er­age is at ₹ 490.3 and 50-day mov­ing av­er­age is at ₹ 496.9.

Post­ing its big­gest one-day fall in three months, the stock ended down 4.6% at ₹ 482.05 on the NSE and lost ₹ 5,370-crore in mar­ket cap­i­tal­isa- tion. Its dif­fer­en­tial vot­ing rights shares ended down 6% at ₹ 297.75. Open in­ter­est in the com­pany’s February fu­tures jumped 9%. T h e a u t o ma k e r re­ported De­cem­ber quar­ter earn­ings in the last half-an-hour of trade on Tuesday. The com­pany’s con­sol­i­dated net profit slumped 96.2% from a year ago to ₹ 112 crore due to weak per­for­mance by sub­sidiary Jaguar Land Rover Au­to­mo­tive. JLR re­ported a net profit of £167 mil­lion in the quar­ter, down from £440 mil­lion last year.

“The ₹ 520-call saw sig­nif­i­cant ad­di­tion on the short side be­fore the re­sults. It will be dif­fi­cult for the stock to cross the level in this se­ries,” said Amit Gupta, head of de­riv­a­tives at ICICIdi­rect. HIGHS & LOWS

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