I don’t follow aarti drugs so not much idea about its fundamentals in details. Last quarter results seemed to meet with market expectations and there was a bounce in stock price. Its interesting to note that a bulk drug company like aarti drugs was given PE of 40 during the sectoral bull run sometime in October 2020. Stock price had run from around 100 levels in Covid lows in March 2020 to 1000 levels in October 2020, 10 times in a matter of 10 months.
Once these kind of moves happen and stock undergoes deep correction, it takes a long long time to recover. Usually smart money is early to exit, say around 900-1000 kind of levels… And once stock starts correcting, some folks (read naive investors) buy assuming its a routine correction, and keep averaging till some time. On further fall those who are in profits start unloading which leads to further correction. All this while the naive investors keep holding their shares, hoping to see their price back again, which does not happen and stock price keeps sliding. Once the whole fall is done , stock price goes into a consolidation phase, often lasting few months to few years and a lot of frustrated investors get out on each rally. Once the last seller is out, real meaningful rally starts. This whole process usually takes 3-5 years or often more.
About buyback, its a bit surprising that a company with net debt is going ahead with buyback.
Technically, post results stock price gapped up and left behind a huge gap between 518-555 and went on to hit a high of 645 and today closed at 582. Above mentioned gap needs to be kept in mind to observe for any support.
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