Multibagger PSU stock jumps 150% in six months. Experts see more upside
Multibager stock: PSU stocks have deliverd stellar return to its investors in last one year. While state-owned banks have taken pause in their continuous rally, some PSU stocks are still in uptrend. MMTC shares are one of them. MMTC share price has rallied near 150 per cent in last six months, but stock market investors believe that the stock still has some steam left in it.
According to stock market experts, MMTC has recently announced its ambitious mining planns in regard to rare minerals like lithium, cobalt, silicon, etc. This is going to benefit the company from monetary perspective from medium to short term. They also said that the Union Cabinet has approved amendment of second schedule the Mines and Minerals Act for specifying rate of royalty in respect of 3 critical and strategic minerals, namely, Lithium, Niobium and Rare Earth Elements (REEs), which is good for MMTC as a company. However, experts believe that one should hold the stock for further rise as it may continue to scale new highs.
Triggers for MMTC share price rally
On reasons that have been fueling MMTC share price, Rajesh Sinha, Senior Research Analyst at Bonanza Portfolio said, “MMTC is a PSU company engaged in business of minerals, metals, precious metals, agro products, fertilizers & chemicals and coal & hydrocarbons. In the past one and the half month the stock has given 77% return mainly due to India’s ambitious plan for mining of rare minerals like, lithium, cobalt, silicon etc., which are critical components towards clean energy. Given the global shift towards clean energy the rare mineral market is expected to witness significant growth.”
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“Recently, the Union Cabinet has approved amendment of Second Schedule of the Mines and Minerals (Development and Regulation) Act, 1957 (‘MMDR Act’) for specifying rate of royalty in respect of 3 critical and strategic minerals, namely, Lithium, Niobium and Rare Earth Elements (REEs). Amendment delisted six minerals, including Lithium and Niobium from the list of atomic minerals, thereby allowing grant of concessions for these minerals to private sector through auction. Critical minerals have gained significance in view of India’s commitment towards energy transition and achieving net-zero emission by 2070,” Bonanza Portfolio expert added.
Critical minerals such Lithium, Niobium and REEs have also emerged as strategic elements due their usages and geo-political scenario. Encouraging indigenous mining would lead to reduction in imports and setting up of related industries and infrastructure projects in India. Central Government is working to launch the first tranche of the auction of critical and strategic minerals shortly.
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“These auctions represent a unique opportunity for MMTC to secure mining rights in promising areas. MMTC’s involvement in mineral exploration and trading aligns with the government’s strategic objectives. If successful in its bids, the company could extract and trade these minerals, potentially boosting its revenue and profitability.” Rajesh Sinha of Bonanza Portfolio said.
MMTC share price outlook
Speaking on MMTC share price outlook, Sumeet Bagadia, Executive Director at Choice Broking said, “MMTC share price has been in uptrend for last one month but those who have this stock in their portfolio can hold the stock for more upside with trailling stop loss at ₹70 apiece levels. The stock may go up to ₹85 apiece levels in near term.”
On suggestion to fresh investors, Sumeet Bagadia of Choice Broking said, “Fresh investors should wait for some profit booking as the multibagger PSU stock has ascended to the tune of 35 per cent in last five sessions.”
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
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Updated: 14 Oct 2023, 12:52 PM IST
