Can Bira 91 deal trigger gains for alcohol stocks? Here's what charts say

After an exciting 2021, shares of major alcohol manufacturers have been under pressure so far this year. Here's what charts suggest is in store for them

Shares of alcohol manufacturers, have so far this calendar year been under pressure, with most of them logging negative returns on a YTD (year till date) basis. United Breweries is one exception, as the stock was up 4.6 per cent so far in 2022.

However, the recent acquisition by Bira 91 - the Indian craft beer brand manufacturer buying out 'The Beer Cafe' in an all-stock deal coiuld create some buzz in the sector and set the stocks soaring, charts suggest. The Beer Cafe is the biggest alcobev chain in Indian having a presence in Pub, Bars, Clubs, and Lounges category. READ ABOUT IT HERE

Back to the listed players, unlike 2022, the year before was exciting for the stocks in the brewery sector. Shares of United Spirits, Radico Khaitan, G M Breweries and Globus Spirits had performed well surging 55 per cent, 170 per cent, 97 per cent, and  316 per cent, respectively.

Here is a technical outlook for listed brewery and alcohol manufactures' stocks.

United Breweries Limited (UBL)

Outlook: Consolidation breakout could steer over Rs 300-point rally.

One could observe a rectangular formation on the daily chart of United Breweries. This means the stock is consolidating in the broad range of Rs 1,750 to Rs 1,550 levels. 

Technically, when the consolidation breakout takes place, the trend sets for a rally over the difference of the range, and in this case, it’s a likely Rs 300-point rally. CLICK HERE FOR THE CHART

United Spirits Ltd (MCDOWELL-N)

Outlook: Failure to hold supports could lead to more drawdown

The negative divergence of the Relative Strength Index (RSI) was the key constraint that pulled the stock from taking out the Rs 900 hurdle. This led to a violation of the 200-day moving average (DMA) support set at Rs 838 and pushed stock on a further decline. The present trend is fragile and could see more drawdown if subsequent cushions of Rs 790 and Rs 750 are negated. If that happens, the counter could slip to Rs 700 level. CLICK HERE FOR THE CHART

Radico Khaitan Limited (RADICO)

Outlook: 50-DMA support of Rs 1,022

After forming a “Golden Cross” on the daily chart, the counter showed fatigue in breakout out. This led the stock price retreat to the Rs 1,022, which is the 50-DMA. 

Now if the counter does not stall at 50-DMA, the positive momentum of the “Golden Cross” could see a negative bias. Only above Rs 1,150 mark, the rally could see medium-term optimism. CLICK HERE FOR THE CHART

G M Breweries Ltd (GMBREW)

Outlook: Requires to bounce over 50-DMA of Rs 604

Shares of G M Breweries seem to be struggling to conquer the 200-DMA placed at Rs 633, according to the daily chart. At the current situation, the stock breached the 50-DMA support of Rs 604, indicative of further weakness. Failure to bounce over 50-DMA might lead the counter to lose the positive stance and slip to Rs 530. CLICK HERE FOR THE CHART

Globus Spirits Ltd (GLOBSSPR)

Outlook: Positive divergence of RSI

Globus Spirits has not had a good time this year. The stock tumbled has 35 per cent with sentiment deteriorating every passing day. However, the recent formation suggests a positive divergence of RSI and if the counter surpasses Rs 896, its 50-DMA, the trend could regain some respite. CLICK HERE FOR THE CHART