Cup & handle Breakout - IKSCurrent Price: ₹1,855
Technical Analysis:
Cup & Handle Breakout Pattern: The provided chart for "INVENTURUS KNOWLEDGE SO L LTD" shows a pattern that resembles a Cup & Handle, with the price breaking out above a resistance level.
Waiting for Confirmation: Your statement "Waiting for confirmation" is crucial. A confirmed breakout typically involves the price sustaining above the resistance level with strong trading volume.
Immediate Target: ₹2,250
Time Frame: 3 to 6 months.
Strict Stop Loss: ₹1,630.
Fundamental Analysis (Based on the images provided for Inventurous Knowledge Solutions Ltd.):
Market Cap: ₹31,858 Cr.
Current Price: ₹1,856 (close to your stated ₹1,855)
Stock P/E: 65.5. This is a very high P/E ratio, indicating significant growth expectations are priced into the stock.
Book Value: ₹104
Dividend Yield: 0.00%. The company does not currently pay dividends.
ROCE (Return on Capital Employed): 27.2%. This is a strong return, indicating efficient use of capital.
ROE (Return on Equity): 33.0%. This is an excellent return, showing strong profitability for shareholders' equity.
Face Value: ₹1.00
Industry P/E: 35.7. IKS's P/E of 65.5 is considerably higher than the industry P/E, suggesting it's valued at a premium compared to its peers.
Price to Sales: 12.0. This is a high Price to Sales ratio, indicating the market values its sales highly.
High / Low (52-week): ₹2,190 / ₹1,226.
Sales (Revenue from Operations): Consistently growing from ₹529 Cr in Mar 2020 to ₹2,664 Cr in Mar 2025.
Operating Profit: Shows strong growth, from ₹162 Cr in Mar 2020 to ₹770 Cr in Mar 2025.
Net Profit: Consistently increasing, from ₹137 Cr in Mar 2020 to ₹486 Cr in Mar 2025.
EPS in Rs.: Grew from ₹166.73 in Mar 2020 to ₹28.33 in Mar 2025. (Note: There's a significant drop in EPS from Mar 2020 (₹166.73) to Mar 2021 (₹200.10) to Mar 2022 (₹13.61) then recovering to ₹28.33 in Mar 2025. This may indicate a stock split or bonus issue that adjusted the EPS calculation over these years, making direct year-on-year numerical comparison without accounting for corporate actions misleading for these specific numbers. However, the net profit is consistently growing).
Compounded Sales Growth: 10 Years: N/A, 5 Years: 52%, 3 Years: 52%, TTM: 47%. These are very strong sales growth figures.
Compounded Profit Growth: 10 Years: N/A, 5 Years: 29%, 3 Years: 25%, TTM: 31%. These are also strong profit growth figures.
Return on Equity: Last Year: 46%, 3 Years: 37%, 5 Years: 39%. Excellent and consistent ROE.
Corporate Action & Latest News:
No specific corporate actions (like dividends for the latest year or splits/bonuses) are listed in the provided snippets.
The strong and consistent growth in sales, operating profit, and net profit indicates positive fundamental performance. This suggests the latest news would likely revolve around strong financial results and positive outlooks for the company.
For a company in "Knowledge Solutions," news might also include new client wins, expansion into new service areas, technological advancements, or strategic partnerships.
Company Order Book:
For a "Knowledge Solutions" company, an "order book" might refer to long-term contracts, recurring client engagements, and new project wins. The consistent sales growth implies a healthy pipeline of work.
Overall Assessment:
Inventurous Knowledge Solutions (IKS) presents a strong fundamental picture with consistent and high growth in sales and profits, coupled with excellent profitability ratios like ROCE and ROE. This explains the premium valuation (Stock P/E of 65.5 vs Industry P/E of 35.7), as the market is clearly pricing in sustained high growth.
The Cup & Handle breakout pattern on the chart is a bullish technical indicator. If confirmed with strong volume, it could propel the stock towards your immediate target of ₹2,250 within 3-6 months. The strict stop loss at ₹1,630 provides risk management.
Key Considerations:
Valuation: The stock is trading at a significant premium to its intrinsic value and industry P/E. This means future growth needs to be exceptionally strong to justify and sustain this valuation.
EPS Interpretation: Be mindful of potential corporate actions (like stock splits) that might have impacted the reported EPS historical numbers. The net profit growth is more consistently indicative of performance.
Confirmation of Breakout: Crucially, wait for proper confirmation of the Cup & Handle breakout with strong volume to validate the technical signal.
Given the strong underlying business performance, excellent growth metrics, and the bullish technical pattern, the immediate target of ₹2,250 within the specified timeframe appears plausible, contingent on the confirmed technical breakout and continued strong fundamental performance.
Disclaimer: This analysis is for informational purposes only and does not constitute investment advice. Investing in stocks, especially those with high valuations, carries inherent risks. Always conduct your own thorough research, carefully analyze the stock chart, assess your risk tolerance, and consult with a qualified financial advisor before making any investment decisions.
