Kotak Bank shares may bounce back from key support
shares of Kotak Mahindra Bank could be in the offing as the price is near a technical support level, which has been breached only during the Global Financial Crisis of 2008, said analysts. But a tearaway rally looks unlikely with the stock seen grinding higher because of technical hurdles.
Kotak shares are around a support level of its 50-day exponential moving average on a monthly time frame placed at ₹1,700-level, according to Tradonomy, an investment advisory. The stock could bounce from these levels, it said. «Fresh buying from smart money could come around these levels, taking it to 1,900-2,200 levels from here,» said Tadonomy's founder Dharan Shah.
On Monday, Kotak Bank gained 0.2% to close at ₹1,726.95 while Bank Nifty and benchmark Nifty gained 0.34% and 0.12%, respectively.
The stock, which has been an underperformer in recent times, has declined 9.5% so far in 2024 as against the 1.6% fall in the Bank Nifty.
«Kotak Bank has underperformed the index for a while and typically bounces back from these levels,» said Kaitav Shah, banking analyst at Anand Rathi Institutional Equities. «In terms of profitability, the return on assets is higher for Kotak compared to peers.»
Shah said that there is upside potential in the stock and large-cap private banks are likely to perform well in the next six months.
Analysts said technical indicators including the weekly Relative Strength Index (RSI) too are hinting at a possible price reversal. «The stock is gradually making strides to surpass the 20-day simple moving
