Why is Eternal Ltd falling/rising?

As of 31-Jul, Eternal Ltd's stock price is currently at Rs 307.85, reflecting an increase of Rs 4.25 or 1.4%. The stock has shown a positive trend today, having gained after four consecutive days of decline, and it is trading above its moving averages across various time frames. Additionally, the stock is close to its 52-week high, just 2.13% away from Rs 314.4. Over the past month, Eternal Ltd has outperformed the benchmark Sensex, with a return of +17.93% compared to the Sensex's -3.00%. However, there are concerns regarding falling investor participation, as delivery volume has decreased significantly against the five-day average. The company has demonstrated healthy long-term growth with a net sales increase of 73.31% annually, and institutional holdings are high at 68.93%, indicating confidence from larger investors despite the company's challenges with debt servicing and recent negative financial results.
In the broader market context, while Eternal Ltd has outperformed the Sensex in the short term, the stock's recent performance contrasts with its negative operating profits and a high Debt to EBITDA ratio, which raises concerns about its financial stability. The stock's ability to generate consistent returns over the last three years, including a 34.14% return in the past year, is noteworthy; however, the reported losses and a significant drop in profits by 50.3% add a layer of risk. Despite these challenges, the stock's current upward movement suggests that investors may be responding positively to its long-term growth potential and institutional support, even as caution remains warranted due to its financial difficulties.