Bajaj Auto shares jump 5% after BofA upgrades stock to ‘Buy’
economictimes.indiatimes.comBajaj Auto shares jumped 5% to hit their 52-week high of Rs 5,084 on the NSE following an upgrade on the stock by brokerage firm BofA. Today's rally marked seven uninterrupted sessions of gain in the stock.
BofA Securities upgraded the stock to 'Buy' from 'Neutral' and hiked the target price to Rs 5,550 from an earlier target of Rs 5,100.
The American brokerage firm said that all business segments of Bajaj Auto are now well-positioned for positive growth in FY25. It expects a 14-15% revenue CAGR over FY23-26.
BofA also lauded Bajaj Auto's business model calling it equipped to undertake both the structural and cyclical drivers at play.
«Exports in our view finally seem to be inflecting,» it said further in the note.
Bajaj Auto stock gave returns of nearly 34% and 42% over a 1-year and year-to-date period respectively, outperforming the Nifty Auto index and the broader Nifty50.
While Nifty Auto has given returns of 22.72% and 29% during the aforementioned time frames, the latter has yielded 12.74% and 10.75%.
Today's gains have taken the stock into an overbought zone with the MFI at 76. Meanwhile, the momentum indicator RSI was at 63, which suggested the stock had still some upside before it entered the overbought zone.
A number above 70 indicates that the stock is trading in an overbought zone while below 30 puts it in an oversold zone.
Bajaj Auto counter has been trading above its 50-day and 200-day Simple Moving Averages (SMAs). The stock has displayed steady movement and traded with relatively low volatility at a one-year beta of 0.6 according to Trendlyne.
Bajaj Auto's standalone net profit rose 42% year-on-year (YoY) to Rs 1,665 crore for the first quarter ended June 2023.
