Sunday, March 14, 2010
PRAJ INDUSTRIES : In a Trading Range, But with bullish signs
Praj Industries has been finding exact support at the upward sloping trendline joining the significant bottoms. The upmove from Rs.70 to Rs.100.85 was retraced by about 61.8% to around Rs.81 after which the stock started moving up.
The downmove from Rs.100.85 to Rs.81 took 13 trading days (Fibonacci time period) which was completely retraced only in 5 trading sessions (again a Fibonacci time period). This is called “Faster Retracement” and is a bullish indication.
The downward sloping trendline joining the significant tops has been breached by the stock in the last week and the close has been significantly higher than this trendline. The stock has been consistently making higher bottoms, which is once again bullish for the stock. The volumes have increased in the last few trading sessions indicating participants increased interest in the stock.
Also there will be news soon about the company completing its process of divesting its US-based subsidiary, Praj Schneider due to economic scenario in US.
The mid-cap engineering firm has an equity capital of Rs 36.94 crore. Face value per share is Rs 2.
The current price of Rs 87.70 discounts the company's Q3 December 2009 annualised EPS of Rs 6.31, by a PE multiple of 13.89.
The company has retained rights for process technology for bio-diesel in North America. Meanwhile, the company has launched a new company in US, Praj Americas Inc, operating out of Houston, to address the markets in North, Central and South America.
Praj Industries offers innovative solutions to significantly add value in bio-ethanol, bio-diesel and brewery plants and related wastewater treatment systems for customers, worldwide.