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Having been in the oversold region for long, analysts expect to see a turnaround for the Mahindra and Mahindra (MNM) stock going forward.
Sector analysts said that the stock price of the company is likely to go up by as much as 2.5% on Thursday. The stock, which has a weightage of 2.3% in the BSE Sensex, is likely to cross the Rs 800-mark, they said.
“The stock is in the heavily oversold region. The company’s tractor sales have been good on the back of good monsoons. It is one of the strong companies and is expected to do well,” said Alex Mathew, head of research at Geojit BNP Paribas Financial Services.
On Wednesday, the share price of the company closed up 1.4% at Rs 779.80. The company announced a 17.32% decline in its total sales numbers in August, lower than the 21.7% decline seen in July this year.
Analysts said that part of the rise in stock was due to the rise seen in the broader markets on Wednesday. Markets on Wednesday rose in anticipation of the change of guard at the RBI, with Raghuram Rajan being appointed as the 23rd governor of the central bank.
The BSE Sensex rose by 1.8% or 332 points to end at 18,567. The NSE Nifty ended the day at 5,448 up 2% or 106 points.
The broader markets are expected to exhibit more upside and continue to see some relief rally, said analysts. This could see index stocks also seeing some rise in share prices, they added.
