Linde India rallies for second day on semiconductor sector opportunity

Linde India has been doing well since the announcement of its third-quarter results, said Hemang Jani, an independent market expert.

"The numbers and the management commentary for expansion of investment to cater to the semiconductor industry has boosted investor confidence in the company," said Jani. "There is also a sentimental impact as the parent company for Linde India (Linde PLC) was added to the Nasdaq 100 two days ago."

"We believe Linde India is well positioned to grab this opportunity on the back of its leadership in the Indian gas market, already established a strong relationship with the Tata Group, and end-to-end solutions/supply chain for semiconductor fabs," said Haitong Securities analyst Chintan Modi, in the note dated March 1, while setting a price target of ₹6,506.

The brokerage said high-purity gases are critical for semiconductor because gases can create the chemical reactions needed to shape a semiconductor's electrical properties.

Analysts said technical factors are also pointing to further upside.

"We anticipate the stock to scale up to ₹7,000-7,200 levels," said Vaishali Parekh, VP-Technical Research at Prabhudas Lilladher. "With favourable factors supporting our view of a positive bias and also with decent volume activity seen, we recommend a buy in this stock keeping a stop loss of ₹5,800."

Linde India has a limited public float, due to which the stock could see sharp moves. "The company has a very limited float, with promoters holding 75% shares, and retail float being less than 10%, and due to any buying interest, the stock price impact is higher," said Jani.