Airtel Slips Post Block Deal, Analyst Flags ₹1,808 Key Support
Bharti Airtel, India’s largest telecommunications company, has slipped 3% following a massive ₹9,300 crore block deal by its promoter Indian Continent Investment. The sudden sell-off has raised concerns among investors, and a SEBI-registered analyst has flagged potential short-term weakness in the stock.
Varunkumar Patel, a SEBI-registered analyst, has identified key technical levels that could impact the stock’s movement in the near term. According to Patel, the short-term weakness could be attributed to a block deal by Indian Continent Investment, which could have led to selling pressure in the market.
Patel’s analysis suggests that the key support for Airtel’s stock is at ₹1,808, and any break below this level could drag the shares toward ₹1,785. On the flip side, the analyst sees resistance at ₹1,900-1,943, which could cap the stock’s upside in the short term.
The Relative Strength Index (RSI) has dropped to near oversold levels, which could indicate a possible bounce in the stock. However, Patel emphasizes that a break below ₹1,857 could signal a more significant decline in the stock’s price.
The block deal by Indian Continent Investment has raised eyebrows among investors and market analysts. The deal, worth ₹9,300 crore, is one of the largest in the company’s history. While the deal could have been a strategic move by the promoter to diversify its portfolio or reduce debt, it has led to a sudden sell-off in the stock.
Airtel’s stock has been under pressure in recent times due to intense competition in the Indian telecom sector and a decline in average revenue per user (ARPU). The company has been struggling to maintain its market share, and its recent quarterly results have been disappointing.
The technical analysis by Patel suggests that the stock could face short-term weakness, which could be attributed to the block deal and the company’s ongoing challenges. However, the analyst’s analysis also highlights potential opportunities for investors who are willing to take a contrarian view.
For investors who are looking to enter the stock, Patel suggests waiting for a pullback to the key support level of ₹1,808. A bounce from this level could provide a decent entry point for investors who are willing to take a medium-term view.
On the other hand, investors who are looking to book profits from their Airtel holdings could consider doing so at the current levels. The stock’s technical indicators are indicating short-term weakness, and a break below the key support level could lead to a decline in the stock’s price.
In conclusion, Airtel’s recent block deal and the resulting sell-off have raised concerns among investors. While the technical analysis by Patel suggests short-term weakness, the stock’s fundamentals and the company’s medium-term prospects remain attractive. Investors who are willing to take a contrarian view could consider entering the stock at the key support level of ₹1,808, while those looking to book profits could consider doing so at the current levels.
