Deepak Nitrite spurts over 20% in three days

Deepak Nitrite rose 7.72% to Rs 2876.05, extending gains for the third straight session.

The stock has surged 20.82% in three sessions from its recent closing low of Rs 2,380.35 on 1 October 2021.

On BSE, 1.91 lakh shares were traded on the counter compared to the average daily volume of 68,000 shares in the past two weeks. On NSE, 45.54 lakh shares were traded compared to the average daily volume of 11.93 lakh shares in the past one quarter.

The counter hit a record high of Rs 2,932 in intraday today. It has surged 309.78% from its 52-week low of Rs 701.85 hit on 20 October 2020. In the past one month, the stock has climbed 22.09% compared with 1.51% rise in the Sensex.

Recent media reports suggested that the power outage in China is seen impacting chemical output by as much as 25%.

China is facing severe power crunch amid a shortage of coal supplies, toughening emissions standards and strong demand from manufacturers and industry.

Widening power shortages in China have halted production at numerous factories including many chemical manufacturers, which could benefit Indian speciality chemical makers.

Deepak Nitrite is one of the leading suppliers of chemical intermediates. It has a diversified portfolio of intermediates that cater to the dyes and pigments, agrochemical, pharmaceutical, plastics, textiles, paper and home and personal care segments in India and overseas.

The chemical maker's consolidated net profit jumped 205% to Rs 302.6 crore on a 126% rise in net sales to Rs 1,526.22 crore in Q1 FY22 over Q1 FY21.

On the technical front, the stock's RSI (relative strength index) stood at 79.39. The RSI oscillates between zero and 100. Traditionally the RSI is considered overbought when above 70 and oversold when below 30.

The stock is trading above its 50 and 200 days simple moving average placed at 2505.92 and 2423.43 respectively. These levels will act as crucial support zones in near term.

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