Robust Weekly Performance Drives Momentum
The stock has delivered an impressive 36.98% return over the last seven days, significantly outpacing the Sensex, which declined by 0.52% during the same period. This sharp divergence highlights strong investor interest in Jhaveri Credits, positioning it as a standout performer within the broader market. The stock’s upward trajectory has been consistent, marking five consecutive days of gains, which has helped to build positive momentum and investor confidence.
Intraday Strength and Opening Gap Reflect Positive Sentiment
On 11-Dec, Jhaveri Credits opened with a gap up of 4.02%, signalling strong buying interest from the outset of trading. The stock also touched an intraday high of ₹218.90, representing a 7.89% increase from the previous close. Such price action indicates robust demand and optimism among traders, further supported by the stock trading above its 5-day, 20-day, and 50-day moving averages. However, it remains below its 100-day and 200-day moving averages, suggesting that while short-term momentum is strong, longer-term trends may still be consolidating.
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Volume and Liquidity Considerations
Despite the strong price gains, investor participation appears to be moderating. Delivery volume on 10-Dec was recorded at 2,160 shares, which is a sharp decline of 55.71% compared to the five-day average delivery volume. This drop in delivery volume suggests that while the stock price is rising, fewer shares are being held for longer-term investment, potentially indicating short-term speculative trading. Nevertheless, liquidity remains adequate for trading, with the stock’s turnover supporting reasonable trade sizes without significant price disruption.
Long-Term Returns Contextualise Recent Gains
Looking beyond the immediate price action, Jhaveri Credits has delivered extraordinary returns over the medium to long term. Over three years, the stock has surged by an astonishing 2,125.08%, vastly outperforming the Sensex’s 36.40% gain. Over five years, the stock’s return is even more remarkable at 9,969.77%, dwarfing the benchmark’s 83.99% increase. However, it is important to note that the stock has underperformed the Sensex on a year-to-date basis, with a decline of 19.80% compared to the Sensex’s 8.55% gain, and similarly over the past year, where it fell 29.47% against the Sensex’s 4.04% rise. This recent underperformance may have set the stage for the current rebound as investors seek value opportunities.
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Sector Outperformance and Market Positioning
Jhaveri Credits has outperformed its sector by 6.6% on the day, underscoring its relative strength within the Gems, Jewellery and Watches industry. This sector outperformance, combined with the stock’s recent price momentum, suggests that investors are increasingly favouring Jhaveri Credits as a key player in its domain. The stock’s ability to maintain gains above short-term moving averages further supports the view that it is currently in a positive technical phase, attracting renewed investor interest despite the broader market’s mixed performance.
Conclusion: A Strong Short-Term Rally Amid Mixed Longer-Term Trends
In summary, Jhaveri Credits’ rise on 11-Dec is driven by a powerful short-term rally that has seen the stock gain nearly 37% over the past week, significantly outperforming the Sensex and its sector. The gap-up opening, intraday highs, and sustained gains above key moving averages reflect strong buying interest and positive sentiment. However, the decline in delivery volume indicates that this rally may be driven more by short-term traders than long-term holders. While the stock’s long-term returns remain exceptional, recent underperformance on a year-to-date and one-year basis may have prompted the current rebound as investors reassess its value proposition. Overall, Jhaveri Credits is demonstrating robust momentum that could attract further attention, but investors should remain mindful of the mixed signals in volume and longer-term trends.
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