Manappuram Finance shares achieved a new 52-week high of ₹133.40 per share on NSE during early morning trading. The company's shares opened with an upside gap and experienced over a 4% intraday gain within a few minutes of the stock market's opening bell on Tuesday.

Stock market experts attribute the rise in Manappuram Finance shares to the increasing gold prices. In the January to March 2023 quarter, gold prices have risen by approximately 8%, which is expected to boost the financial company's business volume and lead to improved results in the current earnings season. Experts predict that Manappuram share price will continue its uptrend and may reach ₹155 per share levels within one to three months after breaking out at ₹137 apiece levels.

Avinash Gorakshkar, Head of Research at Profitmart Securities, explains that the gold price rally has benefited Manappuram Finance due to its exposure to the gold loan business. The continuous rise in gold prices during the recently ended quarter is expected to result in better financial performance for Manappuram Finance Ltd, as higher yellow metal prices would enable gold loan applicants to obtain more money on their valuables.

Gold rates are currently on an upward trend, having risen around 8% in the January to March 2023 quarter and approximately 15% in FY23. This is expected to bolster the company's gold loan order book, leading to better quarterly results for the financial firm.

Gorakshkar advises short-term investors to add Manappuram Finance shares to their portfolios, while current shareholders are encouraged to hold the stock for short-term gains. Sumeet Bagadia, Executive Director at Choice Broking, also recommends shareholders to hold the stock for further upside potential, with a trailing stop loss at ₹120 levels.

Ravi Singhal, CEO at GCL Broking, suggests that fresh investors can initiate new positions in Manappuram Finance shares once the stock breaks out at ₹137 levels, targeting ₹155 levels within one to three months. However, a stop loss at ₹129 should be maintained while taking a new position in the stock. Singhal also advises Manappuram shareholders to upgrade their trailing stop loss from ₹120 to ₹129 once the stock breaks out at ₹137 apiece levels on a closing basis.

Gold prices experienced double-digit growth in fiscal year FY23, emerging as one of the best alternatives for strong returns amid extreme volatility in equities. While Nifty and Sensex have provided flat to negative returns in FY23, gold has risen by an impressive 15% due to macroeconomic risks. In the January to March 2023 quarter, gold prices surged by around 8%.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Found Gold. We advise investors to check with certified experts before taking any investment decisions.