"Divis Lab has remained near Rs 1700 levels since the last couple of months. The traders who tried to go short in the stock are slowly exiting from their positions as the stock is reverting after remaining sideways for sometime. The stock also absorbed the recent losses in Nifty when the index fell from 8630 to 7970.
During this period Divis Lab fell only from Rs 1680 to Rs 1640. It shows inherent strength in the stock and it is likely to move up as the index has finally shown signs of revival." "The current OI in the stock is one of the lowest seen in the last 3 months. Since the October expiry, the stock has remained subdued after hitting Rs 1875 levels. Initially there was long liquidation as open interest witnessed closure of over 7%.
Post this closure, there was short addition of over 35% in a span of 2 trading sessions in the price range of Rs 1800-1840. Later the stock fell till Rs 1650-1700 and stuck up in this range since the month of November.
Buy Divis Lab in the range of Rs 1710-1735, target price: Rs 2050, stop loss: Rs 1556", says ICICIdirect.com research report.
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