Shares of The New India Assurance Company Ltd (NIACL) and IFCI Ltd saw sharp declines in Tuesday's trading session, coming under pressure after weeks of robust gains. This market movement is primarily linked to investors' focus on their respective exposures to the National Stock Exchange (NSE) and its much-anticipated initial public offering (IPO).
NIACL shares were down 10.96 percent, trading at Rs 205.85 at the last check. Despite this recent dip, the stock has maintained a gain of 14.78 percent over the past month and an impressive 52.82 percent over the last six months.
Similarly, IFCI shares traded 6.82 percent lower at Rs 95.62. However, the stock still boasts a significant rise of 25.73 percent in the past month and a remarkable 83.81 percent over the six-month period.
The underlying reason for investor interest, and subsequent volatility, is the NSE's upcoming IPO. The NSE, which operates the world's busiest derivatives market by trading volume, received approval from the Securities and Exchange Board of India (SEBI) earlier this month for its IPO. The issue is expected to launch in the latter part of September.
NIACL holds a direct 1.42 percent stake in the NSE. IFCI's exposure is indirect, stemming from its 52 percent holding in Stock Holding Corporation of India Ltd (SHCIL), which itself owns approximately 4.4 percent of NSE.
Technical Outlook for IFCI Shares
Osho Krishan, Chief Manager – Technical & Derivative Research at Angel One, noted that IFCI had shown strong momentum, breaking above the Rs 85-88 zone to reach new lifetime highs. Krishan stated, "The counter is showcasing some kind of breather from the higher zone and is expected to have its cushion around the breakout neckline, which is placed around the zone of Rs 85. The overall trend remains bullish, with sideways to positive momentum likely to persist." He identified the Rs 102-105 range as a near-term resistance level.
Jigar S Patel, Senior Manager – Technical Research at Anand Rathi, concurred, placing support for IFCI at Rs 86 and resistance near Rs 101. Patel suggested, "A decisive move above Rs 101 could trigger further upside towards Rs 105. The stock is expected to trade within the Rs 86-105 range in the short term."
Technical Outlook for NIACL Shares
Regarding NIACL, Krishan highlighted that the stock had moved above its short-term moving average on strong volumes the previous week. He observed that the counter is currently experiencing profit booking from higher levels, but maintained that the overall technical structure remains bullish. "For now, the support lies around the zone of Rs 190 to Rs 185, while on the higher end the Rs 225 to Rs 230 range is likely to provide resistance in the short-term period for the counter," Krishan advised.
Patel from Anand Rathi set support for NIACL at Rs 195, with resistance near Rs 220. He added, "A decisive move above Rs 220 could trigger further upside towards Rs 240. The stock is expected to trade within the Rs 190-240 range in the short term."