Technical analysts expect the stock of Central Depository Services Limited (CDSL) to move beyond ₹2,800 mark after the recent strength in the stock.

What Happened: CDSL’s shares had hit an all-time high of ₹2,538.65 on July 1, a day before the company’s board approved the issue of bonus shares to its investors. The market infrastructure institution announced bonus shares in the ratio of 1:1, meaning that an investor will receive one share for every share they hold in the company.

The company had also announced July 16 as the record date for deciding the shareholders who will get the total dividend of ₹22 per share announced by the company.

Technical analysts see more up move for the stock as it showed strength and breakout movement with strong volume.

See Also: FPIs Pump ₹10,910 Cr In Financials And Auto, Dump Power And FMCG In June

Rupak De, senior technical analyst, LKP Securities said, “CDSL has been in a sideways consolidation after a sharp up-move. This is very common when a stock is getting ready for a bigger rally. The strength may remain in the stock until it falls below the 50 EMA (currently pegged around 2,100). Therefore, CDSL might remain buy on dips with a stop loss of 2100. On the upside, the stock might move towards 2800 and beyond in the short to medium term.”

Jigar Patel, senior manager- technical research analyst, Anand Rathi Shares and Stock Brokers said, “Recently, Central Depository Services Limited (CDSL) has demonstrated a significant breakout accompanied by substantial trading volume, which is generally considered a positive indicator for future price movements. This breakout suggests a strong upward momentum and increased investor interest in the stock. Prior to this breakout, the daily Relative Strength Index (RSI), a momentum oscillator that measures the speed and change of price movements, had maintained levels above 40. This is important because an RSI above 40 typically indicates a bullish trend. Currently, the RSI is positioned near 64, reinforcing the bullish outlook for CDSL. Based on this technical analysis, it is recommended to initiate a long position in the stock within the price range of 2300 to 2330. The target price for this trade is set at 2600, with a stop-loss order placed at 2175 on a daily closing basis.”

Price Action: Shares of CDSL were up 0.28% to ₹2,326.60 on Friday’s session.

Read Next: Why Are Tomato Prices Turning Red Hot?