Patanjali Foods Ltd.'s shares fell as much as 17.1% on Tuesday to Rs 337.85, extending losses for a third consecutive trading session, while derivatives data pointed to fresh short positions building in the stock.
The decline came on heavy trading volumes and a rise in futures open interest, indicating that traders added new bearish bets as the stock fell. Bloomberg data also showed trading activity was well above recent averages, while the broader market advanced.
Fresh Short Build-Up
Futures data showed open interest increased even as prices declined across key contracts, a combination typically associated with fresh short positions.
The July futures contract fell 18.08% to Rs 333.9, while open interest rose 22.25%. The August contract dropped 18.61% to Rs 333.6, with open interest climbing 283.2%. The September contract declined 19.8% to Rs 331.4 as open interest surged 637.5%.
Trading Volume Surges
According to Bloomberg data, trading volume reached 519,668 shares, about six times the 20-day average of 89,790 shares for the same time of day.
Bloomberg data also showed that 41% of traded shares changed hands at the ask price, while 25% traded at the bid price.
The stock declined to Rs 395.10, below any closing level since July 13, 2023, according to Bloomberg data. During the same period, the Sensex gained 0.7%, while the MSCI Asia Pacific Index rose 2.2%, Bloomberg data showed.
Stock Trails Peers
Bloomberg data showed Patanjali Foods shares have fallen 27% over the past 52 weeks, compared with a 4.1% gain for the company's peer group. The Sensex has declined 6.3% over the same period.
The stock is down 3.5% over the past five trading sessions and has lost 7.2% over the past 30 days, according to Bloomberg data.
Bloomberg data showed the stock trades at 25 times estimated earnings for the next 12 months and 24 times trailing earnings. It is valued at 3.3 times book value.
The company's trailing 12-month dividend yield stands at 1.1%, while Bloomberg Dividend Projections estimate a forward dividend yield of 0.4%.
Analysts Remain Positive
According to Bloomberg data, analysts tracking the stock have five "buy" recommendations, with no "hold" or "sell" ratings.
The consensus rating is 4.8 on a scale of one to five, where one represents a strong sell and five represents a strong buy, Bloomberg data showed.
Bloomberg data also showed the consensus price target is Rs 554.25, implying about 40% upside from the last traded price.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
