Heavy selling in National Stock Exchange (NSE) shares continued on Tuesday. The stock fell from its high of ₹1,878 to below the IPO's upper price band of ₹1,785. The stock was listed at ₹1,800 on BSE, but it fell below ₹1,785 last Monday and the decline continued on Tuesday, September 29.
With this decline, NSE is now out of the list of India's top-10 most valuable listed companies. Now NSE is at number 12, which is below companies like Hindustan Unilever and Sun Pharmaceutical Industries. It is noteworthy that on the day of listing, NSE had become the 10th most valuable company for some time, which pushed HUL down one place.
NSE Share Price: Expert told 2 important levels
According to market experts, the immediate support for the NSE stock is at ₹ 1,760, while the resistance is around ₹ 1,795. SEBI-registered market expert Anuj Gupta says a strong close above ₹1,795 could push the stock towards ₹1,880.
However, if there is weakness below ₹ 1,760, the stock may slide to ₹ 1,700. Investors should keep an eye on these two levels, because they will decide in which direction the stock will move further.
How is the stock for the long term?
Seema Srivastava, Senior Research Analyst, SMC Global Securities, considers NSE as a long-term portfolio stock linked to the Indian economy and capital market activities. According to him, it should not be seen as a short-term trading stock, but from a long-term perspective.
Experts say that trading below the IPO price in itself is not a sign of weak fundamentals. Investors should take decisions keeping in mind the valuation, market direction and time horizon of their investment.
Why did it decline after listing?
There was a lot of excitement in the market regarding the listing of NSE, but profit booking started after the listing. Investors are booking profits by selling shares acquired in IPO, which is putting pressure on prices. Apart from this, the overall weakness of the market has also affected the movement of the stock.
However, NSE business remains strong. The company is the largest stock exchange in the country and continues to dominate the derivatives segment. For long-term investors, the current decline can also be a buying opportunity, but take decisions only as per the advice of experts.
What should investors do?
If you are thinking of investing in NSE shares, then keep an eye on the levels of ₹ 1,760 and ₹ 1,795. The upside potential will increase if it sustains above ₹1,795, while further downside may occur if ₹1,760 is broken. Short-term traders should work with stop-loss.
Long-term investors pay attention to the company's quarterly results, trading volume and market share. (This is not investment advice. The stock market is subject to risks. Consult experts before making any investment.)
Being out of the top-10 is certainly a psychological shock for the market, but it does not have a direct impact on the company's business. NSE's earnings come from trading volumes, listing fees and data services, which depend on market activity. Investors should focus on data rather than sentiment.