Technical Analysis of IDLC on 2 March 2017

Technical Analysis of IDLC on 2 March 2017

This is no buy/sell recommendation - just a trial to see if Technical Analysis (works to an extent) in Dhaka Stock Exchange.

After correction in the Index, the market was again taking a bullish shape. However, supply increased last week and most stocks took a beating – the good, the bad and the ugly.

Was IDLC’s decline from 75 due to the bearish sentiment and/or is market expecting a poor Q1 from it?

Fundamentals: It is a very good company with around 20% annual profit growth in last two years. From 2013 onward, it has been increasing its Cash Dividends while decreasing its Bonus Issues – although it recently issued 50% Rights Share.

I could not get hold of its recent Annual Report but this is the data I have:

	2013	2014	2015	2016
Profit	700	1,246	1,459	1,780
EPS	4.35	6.20	5.81	7.08
Dividend	25% B + 5% C	25% B + 10% C	25%C	30%C
NOCFPS	12.00	-2.00	21.00	-5.00

*The Board of Directors has recommended 30% cash dividend for the year ended on December 31, 2016. Record Date is 14 March ’17.

Currently market is pricing it ~10 PE.

Now to the Technicals: Overall there seems to be a bearish vibe in the market. I am not sure how much IDLC might decline.

But with good upcoming dividends, I would keep it in my watch list to buy on signs of reversal. Or maybe “the investor” could take a long position at his/her desired price.

Stop Loss might be 7% from entry price.

Keep watching . . .