Shares of Deepak Nitrite soar 10 per cent on Wednesday after the company’s subsidiary Deepak Chem Tech signed a memorandum of understanding with the Gujarat government with the intention to invest roughly 5,000 crores over the next four years in projects to establish the production of speciality chemicals, phenol/acetone, and eisphenol at Dahej/Nandesari.
The pharmaceutical and agrochemicals industries rely on speciality chemicals to meet their needs. Acetone and phenol are utilised in a variety of end-user industries, including laminates, plywood, pharmaceuticals, paint, and adhesives. The most significant feedstock for polycarbonate, which has numerous uses in the fields of automotive, electrical and consumer goods, defence, and medical equipment is bisphenol, which is used in epoxy and adhesives.
One of the main things that were anticipated during the company’s March quarter update was the utilisation rates of the Nandesari facility and updates on other capex that were being implemented.
In a brokerage study, MOSL stated that “if the company ventures into speciality or complex products, it would command a better valuation.” The results for the March quarter at Deepak Nitrite were largely in-line with street estimates.
On the technical front, the stock opened at Rs 1,950 apiece on BSE, and touched an intraday high level of Rs 2,144 and low of Rs 1,935.
The share touched a 52-week high of Rs 2,355.55 and a 52-week low of Rs 1,682.15 on November 3, 2022 and July 1, 2022, respectively. It traded 9.79 per cent below its 52-week high and 26.33 per cent above its 52-week low on May 24.
According to Rajesh Bhosale – Equity Technical and Derivative Analyst, Angel One, this stock has been in a consolidation phase for the last few months, however today we are seeing traction with prices up more than 9 per cent.
“The prices have come out of a recent consolidation phase and expect this move to continue in the near term with 2,450 as immediate resistance and any dips towards 2050 to be considered as buying opportunity,” said Bhosale.
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