How to trade Raymond stock as board okays biz split; key levels to watch

Raymond stock outlook: Raymond has rallied 65 per cent in the last 3 months, and over 100 per cent in 7 months; the stock needs to break above Rs 3,173 for a further rally, suggests technical charts

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Raymond on Thursday, post market hours, announced a vertical split of the company into textile and real estate units; thus paving the way for the listing of its real estate arm.

In an exchange filing, Raymond said its board approved the scheme of arrangement of Raymond (demerged company) and Raymond Realty (resulting company) and their respective shareholders. As per the scheme of arrangement, shareholders of Raymond will get one share of Raymond Realty for every share held in the company.

Raymond's real estate business accounted for 24 of the total revenue in FY24.

The company will now undertake the process of getting statutory approvals from the shareholders, the National Company Law Tribunal (NCLT) and other requisite agencies, post which will announce the record date for the demerger.

Against this background, what should be your trading strategy in Raymond stock? Here's what the charts suggest:

Raymond

Last close: Rs 2,940

Upside Potential: 23.5%

Support: Rs 2,862; Rs 2,780; Rs 2,700

Resistance: Rs 3,173

Raymond stock has witnessed a sharp rally of over 65 per cent post its trend line resistance breakout on the weekly chart in mid-April. Overall, the stock has zoomed 109 per cent in the last seven months, and traded in a range of Rs 1,488 - Rs 3,150. CLICK HERE FOR THE CHART

Technically, although overbought, the price-to-moving averages action and momentum oscillators seem to be favourably placed for the stock. Thus, advocating a likely positive bias at the counter.

The weekly chart shows that the uptrend is likely to continue as long as the stock holds above the higher-end of the Bollinger Bands on a closing basis, which as of now stand at Rs 2,862. Thereafter, the chart suggests presence of strong support at RS 2,780 and Rs 2,700 levels for Raymond stock.

On the upside, resistance for the stock exists at Rs 3,173, above which it can potentially rally to Rs 3,350 - Rs 3,490 - Rs 3,630 levels in the current quarter.